Scams pose a global threat that necessitate heightened awareness from all individuals. The internet, advanced technologies, and emerging techniques enable criminals to devise new methods of committing crimes. Although it is concerning that scammers seek to exploit others, there are measures people can take to safeguard themselves and those around them from fraudulent activity. Unfortunately, scams occur more frequently than commonly assumed, necessitating greater vigilance and awareness of schemes such as contractor fraud and other forms of deception. Here are some steps to protect yourself and others specifically from contractor fraud.

Scam Facts First

Before describing contractor fraud, a type of fraud against homeowners and businesses related to home improvements, there are some basics everyone should know, especially since scams affect a great many people. Based on GASA’s Global State of Scams Report 2025, Feedzai has identified five key takeaways regarding scams. Here’s their breakdown from that report.  

1. 57% of adults worldwide have been scammed in the past year.
2. A new profile of scam victims is emerging to include those who are younger, educated, with children, and low-GDP nations.
3. Shopping scams are the most common worldwide (54%) followed by investment scams, and unexpected money scams.
4. 64% of scams are over within one day, after the first point of contact with a scammer.
5. Nearly three quarters (74%) of scam victims report the scam. Others may fail to come forward due to responsibility, practical, and emotional barriers.

The Importance of Scam Awareness

Scams, as a widespread issue, highlight the critical need for public education and awareness to help prevent fraudulent activities. By learning how to recognize and avoid scams, people can better protect themselves and their communities from becoming victims.

Contractor Fraud: An Emerging Concern

Among the many types of scams, contractor fraud is a growing threat, especially during warmer months when home improvement projects are more frequent. Understanding the tactics used in contractor fraud and knowing how to spot warning signs are essential steps in safeguarding against this common deception.

What Is Contractor Fraud?

Contractor fraud involves deceptive practices by individuals or businesses posing as legitimate contractors. These scammers offer services such as home repairs, renovations, or construction, but their intent is to deceive and financially exploit “their clients” aka their targeted victims.

Examples of Contractor Fraud

Contractor fraud typically includes some of the following: demanding upfront payment and then disappearing without completing the work, performing substandard work but charging premium prices, using inferior materials while claiming to use high-quality products, and adding unnecessary charges or services to inflate the bill.

Who Is Targeted for This Type of Scam?

Contractor fraud often targets vulnerable individuals, such as elderly homeowners, people affected by natural disasters, or those unfamiliar with home repair processes. These groups are more likely to trust the scammer or feel pressured into making quick decisions.

How Do Contractor Fraudsters Reach Out to Homeowners?

Contractor fraudsters use a variety of methods to contact and lure homeowners into their schemes. Common tactics include going door-to-door in neighborhoods, especially after natural disasters or storms, when many homes need repairs. These scammers may also reach out through unsolicited phone calls, flyers left in mailboxes or on doorsteps, and advertisements in local newspapers or online platforms. Additionally, some fraudsters use persuasive sales pitches or create a sense of urgency to pressure homeowners into making quick decisions without proper research. By appearing friendly and knowledgeable, they attempt to gain the trust of their targets before carrying out their fraudulent activities.

Why Does This Type of Fraud Escalate in Warmer Weather?

This type of fraud tends to escalate during warmer weather because home improvement and repair projects are more common during this time. Scammers take advantage of increased demand for services after storms or during peak construction seasons.

Examples of Contractor Scams

Contractor scams can take many forms and often follow recognizable patterns.

Skipping out: One common example involves a contractor demanding a large upfront payment and then disappearing without completing any work.

Shoddy workmanship: Another frequent scam is when a contractor performs substandard work but charges premium prices, leaving homeowners with unfinished or poorly done projects.

Inferior materials: Additionally, some contractors use inferior materials while claiming to use high-quality products, resulting in costly repairs later.

Missed deadlines: A contractor hired for home improvements will work a snail’s pace and hardly make any progress – thereby dragging out the project and missing deadlines. They may also charge more fees for the extra time the project is taking.

Extra charges: There are also cases where contractors add unnecessary charges or services to a bill to inflate the total cost, taking advantage of homeowners who may not be familiar with typical pricing or repair processes.

Tips to protect yourself are shared below.

Sounding The Alarm

Many hesitate to discuss scam experiences due to stigma, but those who share help educate others and deserve respect for their honesty. However, it’s time to sound the alarm, and that’s just what a Bucks County, Pennsylvania, residential neighborhood is doing.

Farina’s Story  

Per NBC 10 News Philadelphia, “For one homeowner, it all started with a quick driveway repair after a contractor knocked on his door and handed him a flyer. Greg Farina told NBC 10 that he was happy with the work, so he agreed to let the contractor do more to his home which is when it became a financial nightmare.” According to Farina’s story, the contractor offered to fix a broken pipe. They also found other serious issues with Farina’s home that needed to be fixed as soon as possible. This made the homeowner panic, believing what the contractor falsely told him – that the house was going to be condemned.

How The Scam Took Its Toll

Farina ended up writing several checks for thousands of dollars each, and the workers stopped showing up. The contractor scammed Farina out a substantial amount of money. NBC 10 shares, “For Farina, he says that he spent his retirement account to get the repairs made and then had to dip into it again to get the work done by real construction workers.” Additionally, the work potentially done by the scam contractor was not properly permitted, leaving an additional headache. However, thanks to Farina coming forward to share his story, the FBI is now initiating a full investigation.

A Learning Curve

As consumers, we can learn a few lessons from the above incident.

• Don’t use contractors who go door to door as it is too risky a practice. Instead, stick to licensed and insured contractors that you research and find yourself. Look for proven track records and reviews and references that you can check.
• Don’t rush into decisions. Dishonest scammers posing as contractors will pressure you or create fake emergencies. Avoid hiring someone on the spot and do not use unlicensed handymen to save money.  Instead, take the time to do your research to keep from being scammed and stick to professionals who know what they’re doing.
• Always stick to properly licensed and insured contractors. Don’t simply believe that someone is licensed. Verify their general contractor license through the state board and ask for copies of their general liability insurance policy. Also, per American home improvement expert Bob Vila, go one step further by making sure they have workers’ comp insurance.
• Get multiple estimates before making a final decision – and get everything in writing.  Watch out for contractors who promise to get the job done fast, require huge upfront payments, or come in at way lower costs than others in their profession.
• Having a flyer or brochure doesn’t mean the contractor is legitimate. Had the above homeowner checked the information on the flyer, he would have discovered that the company name, phone number, and address were completely phony.
• In the above case, the homeowner was tricked into believing the contractor was legitimate due to the convincing nature of the contractor and by the sheer number of workers and trucks that the contractor had on site. This shows how large-scale scams can be.
• Construction scammers frequently use scare tactics to get homeowners to pay them straight away. In the above case, the scammer told the homeowner that the home was in danger of being condemned. This made the homeowner panic – and ultimately pay more to fix the problem.
• A “red flag” is a warning sign of a scam. If a contractor wants the money upfront before any work is done or tells you to make out a check to a specific person or a third-party business, these are red flags – meaning it’s likely a scam!
• If you suspect someone is trying to scam you, be firm, say no, and discontinue contact immediately – even if you need to be rude to do so. Report scammers promptly.

Why Do People Wrongly Believe They Are Impervious to Scams?

Many individuals mistakenly believe they are immune to scams due to a sense of confidence in their judgment or the assumption that scams only target other less aware people. This false sense of security can stem from the idea that they are too cautious or experienced to fall for fraudulent schemes. As a result, they may let their guard down, overlook warning signs, or fail to thoroughly research contractors and offers. This misplaced trust increases their vulnerability, making it easier for scammers to take advantage of them, especially when pressured to make quick decisions or when presented with seemingly trustworthy individuals.

How Can People Protect Themselves?

People can protect themselves from contractor fraud by thoroughly researching contractors before hiring, verifying licenses and references, getting written contracts, avoiding large upfront payments, and being cautious of unsolicited offers or high-pressure sales tactics.  

The Rise of Contractor Scams in Warmer Weather

As temperatures increase, homeowners should be aware that fraudsters often take advantage of the changing season by posing as contractors. These scammers use deceptive tactics to defraud consumers, creating financial loss and confusion. They may potentially start small and escalate problems – demanding more money as they promise to fix things. Their dishonest practices not only harm individuals but also damage the reputation of legitimate contractors who follow ethical standards.

Why Scammers Pose as Contractors

Scammers often impersonate contractors because their work frequently involves major home renovation projects that equal large sums of money. The nature of contracting projects, sometimes with minimal oversight, offers opportunities for fraudulent individuals to exploit the system. Scammers know that most homeowners seek to have safe and well-maintained homes. They also take advantage of busy schedules, the complexity of projects, and the trust homeowners place in them. As a result, homeowners must remain vigilant and take preventive steps to protect themselves from falling victim to contractor fraud.

Growing in Complexity  

Contractor scams are evolving, becoming more sophisticated and difficult to detect. In addition to lying to consumers, fraudsters might even employ advanced strategies such as phishing schemes and fake documentation that make them appear genuine and trustworthy. Also watch out for lack of credentials, misrepresentation of price or quality of materials, overbilling for services not performed, and escalating costs once a project is underway. These methods are specifically designed to mislead homeowners and exploit their trust. If you hired a contractor who you believe is ripping you off, do not pay them – or contact your bank and stop payment if possible. Contact the Federal Trade Commission at ReportFraud.ftc.gov. Note that FTC offers resources and advice to consumers who wish to report scams and don’t know where to begin. Depending upon the level and nature of the scam, you may also wish to contact the Better Business Bureau (BBB), your local District Attorney’s Office, the Department of Consumer Affairs, local news and consumer reporters, and/or local authorities.

Contractor Fraud: In Summary  

To counteract the growing threat of contractor fraud, it is essential for homeowners to stay informed about current scam techniques and recognize common patterns used by scammers. By understanding the latest fraudulent practices, individuals can avoid falling victim to these schemes. Additionally, exposing scams and reporting suspicious activity helps protect others and prevents scammers from continuing their operations.

Show your bravery: Protect yourself and your community by reporting fraud, scams, and bad business practices to Reportfraud.ftc.gov.

Disclosure: This article is for information only and does not constitute or replace professional advice.