New Jersey Rounds Up Unregistered Contractors

The problem of unregistered, often shady, home improvement contractors is a common one, afflicting consumers just about everywhere. (Consumer complaints about contractors).

Enforcement of registration and licensing laws varies widely from state to state, with New Jersey taking perhaps the most aggressive approach. The state's Division of Consumer Affairs has dispatched undercover agents to look for unregistered contractors.

Using a pickup truck disguised as a home improvement contractor’s truck, the investigators are scouting the parking lots of home improvement stores, hardware stores, and other places across the state where contractors congregate, seeking out those who advertise that they perform home improvement work but fail to display a state registration number.

“Each year, phony contractors and unregistered contractors rip off hundreds of New Jersey consumers, leaving them on the hook for as little as $200 to as much as $100,000 or more,” Attorney General Paula T. Dow said. “When contractors register with the state, they provide consumers with a valuable tool that helps them learn about the company’s background and make an informed choice before letting a contractor into their home.”

Complaints about dishonest or shoddy home improvement contractors are the second-most common type of complaint the State Division of Consumer Affairs received from consumers in 2010, representing 1,401 of the 13,761 consumer complaints the Division received.

When the undercover agents find unregistered contractors, they've warned to get into compliance with the law – or face fines up to $10,000 each.

Under New Jersey’s Contractors’ Registration Act, home improvement contractors must register with the state and obtain a registration number that begins “13VH …” Contractors must display that number on their signage, including signs on commercial vehicles, as a reference for consumers. To register, a home improvement contractor must provide proof of liability insurance and disclose a legitimate business address.

“We’re going on the offensive,” said Thomas R. Calcagni, acting director of the State Division of Consumer Affairs. “In the past, we would take action against the unregistered contractor only as consumer complaints were received. No longer. Now, we’re taking the fight to them. If you are a home improvement contractor, and you’re operating outside of the law, we’re coming after you. And if you don’t fall in line, you’ll pay.”

Since the undercover operation began March 2, investigators issued warnings to 54 contractors in Essex, Gloucester, Morris and Warren counties. State Consumer Affairs investigators worked in partnership with the Gloucester and Essex County Offices of Consumer Affairs. In each case, the contractor advertised for home improvement work with signs on a commercial vehicle, but failed to display the “13VH” number that proves the contractor is registered.

With each warning, contractors were ordered to get into compliance – by registering with the state if they were not already registered, or by displaying their number on the signage if they were registered – within 30 days or face fines up to $10,000 each.