UNLICENSED! Illegal Operators

Making Illegal Operators Disappear

Are you a landscape contractor who has lost jobs to:
unlicensed operators?
contractors who operate outside of their license classification?
competitors who do not pay workers' compensation insurance, disability insurance, unemployment insurance, or federal and state employment taxes?

If you are a victim of these illegal activities,
the California Landscape Contractors Association has some good news for you:

There are two state-government entities that are responsible for enforcing some or all of the laws that pertain to these activities: the Contractors State License Board (CSLB) and the Joint Enforcement Strike Force. The former oversees the Statewide Investigation Fraud Team (SWIFT), which investigates complaints against unlicensed contracting and related activities. The latter is a multi-agency organization that seeks to root out the underground economy and devotes a large portion of its enforcement efforts to the construction industry.

It would be a mistake, however, to sit back and wait for government to take care of the problem for you. If you really want to put your illegal competition out of business, you must do your part. You must report illegal activities to the proper state agency. This section of the CLCA website is intended to help you do that and more.

CLCA regrets that we can't make illegal operators disappear with a snap of the finger. That's not the way it is in the real world. But we strongly believe that if you follow up on some of our suggestions and information, and if you take some individual action and responsibility, you'll be surprised at what can be achieved.

Gather Information

It's important to gather as much information as possible when faced with competition you believe to be illegal. Try to get the operator's name, address, phone number, vehicle make, and vehicle license number. Get the address of his or her jobs in progress. Get the project owner's name, address, and phone number. Collect the operator's advertisements, fliers, and business cards. Is the person using a contractor's license number? If so, make a note of the number. In addition, pictures can be excellent evidence, if you have an opportunity to take them. Check with the CSLB to find out if the person or firm is licensed -- and licensed in the proper category. To check a license, go to License Status Check on the CSLB's website. You'll find a wealth of information there on all of California's licensed contractors.

Unlicensed Operators

After you've collected as much information as you can, and you've determined that the person or firm is operating without a license, fill out an Unlicensed Activity Lead Form and send it to the nearest CSLB SWIFT unit. The addresses and fax numbers of the two California units are on the form. Also fill out a Lead Report and send it to Underground Economy Operations (the Joint Enforcement Strike Force) at the address on the form. Although SWIFT and the Joint Enforcement Strike Force cooperate very closely with one another on unlicensed operations, CLCA recommends that you inform both organizations to improve the chances of quick action. If you do that, write "cc" and the name of the other organization on both reports; that way both organizations will know that the other received the information as well.

Operating Out of License Classification

If the person is licensed, but not in the correct classification, contact a local CSLB deputy for investigation. Contact CSLB offices statewide here. You can also find a local office by going to the listing for State Government Offices in the white pages of your telephone book. Look for "Consumer Affairs, Dept. of." Below it there should be a number for your nearest CSLB district office.

Employment Fraud

If the person is licensed, but you have good reason to believe he or she is committing employment fraud, fill out the Lead Report and send it to the Joint Enforcement Strike Force.

Confidentiality

If you wish to remain anonymous, you should not put your name on the lead referral form you send to the Joint Enforcement Strike Force. The accused has the right to see this report during the administrative proceeding and/or litigation process. The Joint Enforcement Strike Force has assured CLCA that anonymous leads are treated no differently from other leads. SWIFT, on the other hand, prefers that you give your name when making a report. They would like to be able to call you back and get more information if, for example, the unlicensed operator is not at the project the day they investigate. If you give them your name and request confidentiality, the odds are low that the unlicensed operator would ever learn that you were the one who reported him or her. The unlicensed operator could conceivably find out, however, in the unlikely event the file is subpoenaed.

Following Up on Your Complaint

SWIFT is willing to notify you about the status and results of an investigation. In fact, it's a good idea to follow up with them on reports or complaints you make. The Joint Enforcement Strike Force, on the other hand, will not and cannot share the results of its investigations.

Owner-Builder Information and Verification

State housing law requires every city and county to give property owners who apply for a building permit certain information about their liabilities as an owner-builder as well as a verification form to fill out (Health and Safety Code Section 19830-19832).

State law also requires these documents to be given by mail or to the applicant at the time the application is made, provided that the applicant presents identification sufficient to identify himself or herself as the owner. However, all too often the documents are given instead to the unlicensed operator who is applying for the permit. CLCA believes that if these documents actually reached more property owners, there wouldn't be as much unlicensed activity as there is today.

If you have reason to believe that your city or county is not mailing these documents or requiring identification as required by law, CLCA suggests that you contact your representative on the city council or board of supervisors, show him or her the relevant statutes from the Health and Safety Code, and ask that action be taken to bring the jurisdiction's policies into compliance with the law.