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Chicago Home Remodeling Firm Under Fire

February 1, 2005
With an avalanche of consumer complaints piling up, Cook County Judge Peter Flynn has issued a temporary restraining order (TRO) against a Chicago-area construction and home repair company and its president after they allegedly bilked 31 consumers out of approximately $2.1 million.

The TRO prohibits Resnick and MoMax from engaging in the home repair, improvement or remodeling business; spending, withdrawing, concealing or transferring money except to pay taxes, attorneys fees or ordinary living expenses; and orders Resnick and his company to preserve all business-related records and materials.

Since December 1, 2004, Illinois Attorney General Lisa Madigan's Consumer Fraud Division has received 27 consumer complaints against MoMax and Resnick. In total, Madigan's office has received 31 complaints against the company since 2003.

"What started out as a small blizzard of complaints has turned into an avalanche of alleged fraud," Madigan said.

"From the stories we are being told, the amounts of money lost and the problems these defendants have caused appear to be truly enormous," she said. "While these defendants advertised themselves as being in the construction business, very often, they were in the destruction business. We are making every effort to ensure that they will be held accountable."

Madigan first filed suit last month, asking the court to prohibit the defendants from engaging in the business of home repair and remodeling and from further violating Illinois' consumer protection laws. The lawsuit also seeks a civil penalty of $50,000 and additional penalties of $50,000 per violation found to be committed with the intent to defraud. Finally, Madigan's lawsuit asks the court to order the defendants to pay restitution to consumers.

Using a flashy, colorful Web site to entice consumers, MoMax solicits business online and then sends a representative to visit consumers in their homes to negotiate and sign contracts for home repair and construction projects.

According to the complaints, the MoMax salespersons promised that large-scale construction projects could be finished in a few months and that MoMax's own qualified construction experts would be used to complete the jobs.

As an example of the complaints against MoMax and Resnick, an Evanston couple allegedly gave the company more than $100,000 to begin a second story addition to their home. To do this work, MoMax was required to seek permits from the Village of Skokie (some Evanston residences are under Skokie zoning); however, the company allegedly failed to submit the paperwork, then never appeared at a Skokie zoning meeting which was required to obtain the permit.

The couple, who were expecting their first child at the time, returned from out of town and learned Resnick had done nothing and put their project months behind.

MoMax, Inc., which also does business as MoMax Builders, Inc., is an Illinois corporation currently not in good standing for failure to file annual reports with the Illinois Secretary of State. Resnick and MoMax have been engaged in the practice of home repair and construction and have advertised their services since at least 1992.

Resnick and MoMax are charged with multiple violations of the Illinois Consumer Fraud and Deceptive Business Practices Act and the Home Repair and Remodeling Act for accepting money and then failing to either begin work on the consumers' homes or finish projects they did start, failing to refund homeowners' down payments after the homeowners had canceled their contracts, providing consumers with invalid certificates of insurance and waivers of liens, and accepting money for the home repair projects and then deposited it into personal accounts or used it for personal expenses.

In addition, the defendants allegedly failed to obtain proper permits before beginning work on the consumers' homes, failed to provide consumers with the legally-required notice of consumers' three-day right to cancel and failed to provide homeowners with copies of the home repair consumer's rights pamphlets.

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