New Jersey Division of Consumer Affairs Files Complaint Against Monmouth County Contractor Alleging Fraud in Connection with Rebuilding and Repair of Sandy-Damaged Homes
released on October 27, 2017
found in newsletter: October 2017
NEWARK – Attorney General Christopher S. Porrino and the Division of Consumer Affairs have filed a Complaint alleging that a Monmouth County contractor used deceptive practices to obtain more than $230,000 in federal relief funds from four homeowners who sought to have their damaged homes rebuilt, elevated and/or repaired after Superstorm Sandy.
According to the Complaint, filed in the Superior Court Chancery Division in Monmouth County, Eco-Coastal Limited Liability Company and its owner, James J. Sullivan, allegedly violated the New Jersey Consumer Fraud Act, the Contractors’ Registration Act, Regulations Governing Home Elevation Contractors and the Regulations Governing Home Improvement Practices by failing to perform contracted-for improvements and/or home elevations after receiving federal Reconstruction, Rehabilitation, Elevation and Mitigation (RREM) Program funds and consumer payments.
In addition, the Division alleges that the company violated a 2016 Consent Order in which the company agreed to comply with the Consumer Fraud Act and other contractor regulations and to pay a civil penalty of $1,250. The Division alleges the civil penalty was never paid, despite several efforts to contact Eco-Coastal.
Eco-Coastal also agreed to perform home elevations without ever being registered with the Division as a Home Elevation Contractor.
“This company has an admitted history of failure to adhere to the state’s rules governing home improvement contractors,” said Attorney General Porrino. “We will not tolerate repeated abuses of consumers, especially those who are desperate to return home after Superstorm Sandy.”
“The Division remains committed to rooting out those contractors who have fraudulently taken advantage of New Jersey residents simply seeking to return home after a horrific natural disaster,” said Sharon M. Joyce, Acting Director of the Division of Consumer Affairs. “This action sends a message. If contractors take money for work which they cannot or will not finish, we will hold them responsible for the damage they have done to consumers.”
The consumers identified in the Complaint received money from the Reconstruction, Rehabilitation, Elevation and Mitigation (RREM) Program, administered by the New Jersey Department of Community Affairs (“DCA”), to pay for construction work on Sandy-damaged homes. The RREM Program is the state’s largest rebuilding initiative.
The Complaint also alleges that the defendants did not include required standard language in its contracts concerning dates when work would commence and be completed, information about materials to be used and the terms and conditions affecting price. The defendants’ contracts did not include the standard informational statement and toll-free telephone number provided by the Division for consumers seeking information about Home Improvement Contractors, nor did the documents include Eco-Coastal’s HIC registration number.
“Contractor fraud can significantly erode storm-impacted families’ financial security and emotional well-being,” said DCA Commissioner Charles A. Richman. “For this reason, my Department remains a committed partner with the Attorney General’s Office to thwart dishonest contractors and help Sandy-affected families get their rebuilding projects back on track.”
The Complaint, among other things, also alleges that:
The defendants failed to complete work specified in the contract and then at times failed to respond to consumers’ calls, e-mails and texts inquiring about when work would continue.
The defendants failed to pay subcontractors, who then refused to continue working until payment was received, which resulted in work being stopped or delayed. On two occasions, consumers paid subcontractors out-of-pocket, payments which were the defendants’ obligation.
The defendants refused to provide consumers with documents, such as invoices, required by the RREM Program.
The defendants performed substandard work and then failed to make the necessary corrective repairs.
The Division is seeking restitution for any consumer affected by the defendants’ alleged conduct, a return of the federal funds acquired by the defendants and civil penalties for the alleged violations of the Consumer Fraud Act. The Division is also seeking to permanently enjoin the defendants from doing construction work in New Jersey.
Investigators Joseph Iasso and Brittany Kieran of the Division’s Office of Consumer Protection conducted the investigations.
Deputy Attorney General Erin M. Greene of the Consumer Fraud Prosecution Section within the Division of Law, is representing the State in this matter.
Consumers who believe they have been cheated or scammed by a business, or suspect any other form of consumer abuse, can file an online complaint with the State Division of Consumer Affairs by visiting its website or by calling 1-800-242-5846 (toll free within New Jersey) or 973-504- 6200.
Original Press Release