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1. What is construction fraud?

According to the Code of Virginia, A person has committed the crime of Construction Fraud when they have received an advance (money, merchandise, or other thing of value) to perform construction or improvements on a property and then failed to perform the work. Additionally, that person must have failed to return the advance after given sufficient notice.

Sufficient Notice is further defined in the Code. It states that Contractors must be given the opportunity to return the advance before criminal proceedings can be initiated. A certified 15 Day Letter must be sent to the contractor with "Return Receipt Requested."

Prior to filing a report, you must send the 15 Day Letter!

2. Can the contractor be prosecuted?

Most issues with your contractor must be worked out in Civil Court, and not in the Criminal Justice System. These types of cases are complex and often very difficult to prosecute. The Commonwealth has the burden to prove the following:

• The defendant (contractor) was paid to have the work completed. This could include a cancelled check, signed credit card receipt, or a cash receipt.
• The defendant had a fraudulent intent at the time of the payment.
• The defendant promised to perform the work, usually by possessing a written contract. Unfortunately, many victims fail to obtain a written contract. This makes any prosecution extremely difficult.
• The defendant failed to perform the work.
• The defendant failed to return the advance payment within 15 days of the request to do so by certified mail to the defendants last known address or the address listed on the contract.

Valid defenses to the fraudulent intent have included the contractors poor management practices and financial distress, Klink v. Commonwealth, 12 Va. App. 815 (1991).

Subcontractors, who were hired to complete a job, and were not paid, could also be victims of a crime.

3. If my situation is civil in nature, what can I do?

If you are not satisfied with the work that has been completed, try to talk with the contractor.  With level heads, many issues can be resolved through communication.  You could also consider sending a certified letter explaining the problems that you have with the work and what you expect to be done about it.

• Consider filing a complaint with the Better Business Bureau.
• Contact the Virginia Department of Professional and Occupational Regulation (DPOR), who can investigate licensing and building code violations.

4. What can I do to protect myself?

Learn about this on our How to Protect Yourself From Construction Fraud page.