Florida lawmakers scrutinize contractor fraud after hurricanes

(The Center Square) — Florida lawmakers are taking a closer look this week into fraud committed by contractors in the wake of hurricanes Ian and Idalia.

The Florida House Select Committee on Hurricane Resiliency and Recovery met on Monday to discuss the growing number of fraud cases committed by contractors post-hurricane in the Sunshine State.

James Miller, Assistant State Attorney for Economic Crime and the Economic Crime Unit Chief for the 20th Judicial Circuit, which consists of Charlotte, Collier, Glades, Hendry, and Lee counties, spoke about the growing number of fraud victims taken advantage of by unscrupulous contractors. Miller suggested amendments to Florida law that would require contractors to use escrow.

“The biggest problem we have in Florida is that too many contractors rob Peter to pay Paul, creating essentially a Ponzi scheme to keep their businesses going,” Miller said. “When they run out of customers, the bottom falls out.”

Miller added that there is little recourse for contractors who fail to do a job, especially if they had been paid in cash. Miller stated that amending statutes would help protect not only homeowners, but subcontractors and material suppliers too.

State Attorney John Durrett from the 3rd Judicial Circuit, which presides over the counties of Columbia, Dixie, Hamilton, Lafayette, Madison, Suwannee, and Taylor, stated that while the people in his circuit are resilient, there have been cases of misapplication of construction funds.

Durrett added that he supports amendments to establish an escrow requirement and added that a lot of these contractors are coming from out-of-state and/or are unlicensed, essentially taking advantage and preying on people while they are in one of the most vulnerable times of their lives.

During a state of emergency, penalties for such fraud are elevated to a third-degree felony, however, according to Durrett, because many contractors come from outside of Florida, there is no way to hold them accountable once they leave the state.

Larry Basford, State Attorney for the 14th Judicial Circuit – which represents Bay, Calhoun, Gulf, Holmes, Jackson and Washington counties, stated that over half of the victims he has seen are senior citizens.

Basford told lawmakers that while there have been some instances where a contractor has been jailed for fraud, the likelihood that victims will get their money back, often hundreds of thousands of dollars, is nearly zero.

Committee Chair Rep. Michael Grant, R-Port Charlotte, stated that contractor fraud is an important topic. Still, one that doesn’t often get discussed, and added that he appreciates the insights on what lawmakers can do to stem that.