BEWARE this crooked contractor in San Antonio!!

BEWARE this crooked contractor in San Antonio!!

Contractor · San Antonio, TX · Member since 2013 · 647 posts · 205 votes

To those who have read my other post regarding this gentleman, here is a bit more elaboration. To preface this synopsis, though, let's be clear that many many mistakes were made on all our (investors') end, so for those of you who have never run into something like this, please take the lessons home with you. Don't be scared to operate out of your areas, but put procedures in place to protect yourselves. Also, since he seems to have disappeared, any info on him or his associates/clients (victims...?) would be appreciated. In any event, here's a VERY concise summary:

BACKGROUND:

I first started dealing with Robert “Bob” Gonzalez of Pleasant Renovation and Remodeling in October of 2013 when I hired him to the role of general contractor for a rehab property in San Antonio, Texas. Around the same time, a colleague hired him for work on 2 rehabs. The timeframe on my rehab and one of his was 6-8 weeks, with his second property to follow completion of the first. Bob offered us a VERY competitive price, and I must say, he was one of the smoothest talkers I’ve ever met. We were assured by Bob that he had plenty of crews to do the work in a timely manner, but come December, both properties were unfinished, and we couldn’t figure out why, with all the workers on the project. To sum THAT up in a nutshell, Bob had perhaps 6-8 part-to-full time employees of varying degrees of skill who he would pull off his other projects when he learned that the owner was going to be dropping by. Otherwise, he was just constantly, as in daily, reallocating his crews off our projects to those of new clients to show them how "hard working" he and his guys were and to convince them of the need for more funds to "keep up his progress", then when he got them, he'd move on to the next victim...I mean, client. Of course, much of this was only learned after the fact.

Two months after starting work on my project, Bob was barely done with half the work on my property, and perhaps ¾ finished with my colleague’s first property. At this point he had done most of the aesthetic work interior and exterior, but had not finished the interior, or the HVAC, electrical, appliance and kitchen installation, bathrooms, etc. At this point we both started to pressure him, though the latter (more expensive) draws had to be paid to get the HVAC, final electrical, etc underway. Once he received the funds for these, Bob slowed to a crawl, with workers not showing up at all, doing shoddy work when they were there, etc. In light of this over the next couple of months, my colleague literally ended up kicking Bob off of his jobsite and supervising Bob’s guys himself while searching for deficiencies. This particular search found the following (off the top of my head): HOT wires loose under the insulation in the attic; non-working plugs and switches throughout the house; numerous aesthetic QC issues; showers/sinks with no hot water owing to incorrect plumbing; a hot wire SPLICED INTO A METAL LAMP CORD found in the attic… In a nutshell, his entire house had to be rewired because Bob had turned it into a FIRETRAP; on top of this, two dishwashers were “removed for faulty (insert excuse here)” and replaced with inferior models, in addition to a stove, during the three or so week period.

Now, let’s go back to my place. Between January and April, I pressed Bob repeatedly to finish up, particularly after he received the draws to finish the more expensive final work. Towards early April, Bob stated that a number of burglaries had occurred in the area, and that he had removed my oven and dishwasher “so they couldn’t be stolen”, though I know for a fact no oven or dishwasher was ever there. Long story short, Bob disappeared in late April with mine and my colleague’s remaining (paid for) work unfinished. Immediately before his disappearance, the above-mentioned appliance removal occurred at my colleague’s property, and mine was broken into shortly after with no signs of forced entry, with the exception of the loss of about $3,000 worth of flooring and other materials, and the door being unlocked and ajar. In the case of my property, Bob had been seen a couple weeks prior to his disappearance by my colleague, who helped keep an eye on the property, changing the locks; only my colleague and Bob had a key to the new lock.

After Bob vanished, I was left with about $10,000 worth of paid for, unfinished work, plus the additional $10,000 I had to shell out, and my colleague was out approximately $15,000 for starting his second property.

ITEMS AND OBSERVATIONS AFTER THE FACT:

Bob had about six investors (that we now know about), both local and out of town, who had the exact same issues in the same timeframe;

When he disappeared, Bob had approximately $100,000 in paid for, unfinished work between the six owners, not counting tens of thousands of dollars in shoddy work, ALSO not counting the losses of items stolen afterward;

After Bob’s disappearance, EACH one’s property was broken into, with the loss of appliances, HVAC components, granite countertops, and all varieties of building materials, adding up to tens of thousands of dollars;

Bob is known to have used fake and unrelated addresses, claimed possession of properties he didn't own, and generally changes his stories when pressed, especially when called out.

Bob utilizes two long-expired contractor license numbers on the letterhead of his estimates, and he has no current licenses.

To summarize this review, STAY AWAY FROM THIS MAN AND HIS ASSOCIATES!! If you know of him or have colleagues who are undergoing similar circumstances, dig deeper, as it may be the same gentleman. CAVEAT EMPTOR.

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Contractor · Atlanta, GA · Member since 2008 · 978 posts · 985 votes
12y

You bought a service from a guy who sold you on the premise of your sheer, absolute, blinding greed. He then lied to you, stole from you, and put you through the wringer because he continued to appeal to your greed.

Your situation is unfortunate, and your story sad. It's a story I've heard a hundred times from a hundred investors.

Folks, don't be blinded by greed and hire someone based solely on the basis that he told you the lie you wanted to hear. ("Sure we can do this for $50,000! That guy who told you $150,000 is just full o' shyte!")

I hope you find this guy, and I hope you hang him by his toes. I hope your state has a licensing board and I hope that you turn them on to him. I hope that you do everything in your power to warn other people about him (Yelp, Google reviews, etc.)... in short, I hope that he never gets the opportunity to rob someone again.

I also hope that your story serves as a beautiful warning to the next investor, dealing with the next Robert Gonzalez. I hope that investors everywhere will stop listening to silver-tongued liars who will rob from them.

And THANK YOU for having the balls to admit that you got taken! Warning stories like this are incredibly valuable to the community as a whole.

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  • Contractor · Round Rock, TX · Member since 2013 · 767 posts · 389 votes
    12y

    So by VERY competitive. Do you mean the cheapest price?

  • Contractor · San Antonio, TX · Member since 2013 · 647 posts · 205 votes
    12y

    @Brian Mathews , yes, but so far lower it really should have been a flag; I seem to remember someone on BP mentioning that one should perhaps not necessarily pick the very lowest bid, particularly if it's too low; I now understand why.

  • Contractor · Atlanta, GA · Member since 2008 · 978 posts · 985 votes
    12y

    You bought a service from a guy who sold you on the premise of your sheer, absolute, blinding greed. He then lied to you, stole from you, and put you through the wringer because he continued to appeal to your greed.

    Your situation is unfortunate, and your story sad. It's a story I've heard a hundred times from a hundred investors.

    Folks, don't be blinded by greed and hire someone based solely on the basis that he told you the lie you wanted to hear. ("Sure we can do this for $50,000! That guy who told you $150,000 is just full o' shyte!")

    I hope you find this guy, and I hope you hang him by his toes. I hope your state has a licensing board and I hope that you turn them on to him. I hope that you do everything in your power to warn other people about him (Yelp, Google reviews, etc.)... in short, I hope that he never gets the opportunity to rob someone again.

    I also hope that your story serves as a beautiful warning to the next investor, dealing with the next Robert Gonzalez. I hope that investors everywhere will stop listening to silver-tongued liars who will rob from them.

    And THANK YOU for having the balls to admit that you got taken! Warning stories like this are incredibly valuable to the community as a whole.

  • Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    12y

    @Chad Clanton unfortunate story. Thank you for sharing and warning others about this man. I hope you can bounce back from this incident.

  • Contractor · Round Rock, TX · Member since 2013 · 767 posts · 389 votes
    12y
    Originally posted by @Chad Clanton:
    @Brian Mathews , yes, but so far lower it really should have been a flag; I seem to remember someone on BP mentioning that one should perhaps not necessarily pick the very lowest bid, particularly if it's too low; I now understand why.

    I've said it time and time again. Never hire the low price guy. You have to consider something. If you get say 5 bids, prices should be pretty consistent. They are using the same materials and the same labor pool. If one of them is way low, there is a reason why. Oh well. Live and learn.

  • Contractor · San Antonio, TX · Member since 2013 · 647 posts · 205 votes
    12y

    @Aaron McGinnis , if I were going to make an excuse, I'd actually go for inexperience, since this if my first flip ;-) Lol, I'm actually going to go for me being a jacka** though, instead :-) The worst part is that looking back at every...single...step, I ask myself "seriously, did I miss that?", or "why didn't I check that out?". I'm also an out of state investor from Virginia, and I should have been much more involved, even with the absolute (legitimate) trust I had and still have in the members of my team (other than Bob and most of his guys, of course). From here on out, I'll be down every 4-6 weeks to check up on things, in addition to the team I have in place, all of whom learned the same lessons.

    The "Quick Tips" for this post are:

    BE INVOLVED, and not just by phone.

    Ensure the quality of your contract; game out the worst case and figure out how to safeguard against it.

    Identify clear and specific benchmarks to be completed, with each draw conditional upon the completion of the appropriate benchmark.

    Get pictures, always!

    If something seems fishy, check it out. Don't be confrontational about it, just look into it, in depth.

    Confirm licensing: FYI, San Antonio's online database of licensed contractors has been out of date, with incorrect expiration dates, dates not showing expired when they were, etc every time I've called to crosscheck. Moral of this story, always call.

    There are many more which I'll post to my blog in the next few days, but those are a few.

    Strange as it may seem, I'm actually happy that this happened on my first flip; I've learned so, soooo many extremely informative lessons which I never would have learned if things had gone smoothly, and I'd much rather learn them at the price point I did than with a much more expensive property; I've already come to the firm realization that real estate is all about adaptation, and I fully intend to use this experience to do just that. Everyone, thanks for all of your input, and please, keep getting the word out so that others don't get taken by this guy. Good luck everyone, and invest smart.

  • Contractor · San Antonio, TX · Member since 2013 · 647 posts · 205 votes
    12y

    @Brian Mathews Makes sense, particularly now. Another issue there, insufficient bids. I got a referral to Bob from someone I trust implicitly, but I guess that referral was based off of a referral HE received from someone HE trusted, etc... One other key point to notice here for anyone who might run into Bob or someone like him: he played the lot of us, all six or so, off of each other, so we were constantly reinforcing his position. I will say it was very cleverly done. Another lesson learned: just because you have other people telling you something, even multiple people, doesn't necessarily make it so. Apply your own independent thought process at all times, don't get caught with the crowd. The crowd may have the best intentions in the world, but it may be wrong too.

  • Developer · Los Angeles, CA · Member since 2014 · 151 posts · 31 votes
    12y

    I learnt my lesson a long time ago when I paid about $100 in paid in advance for a job and never saw the guy return. Since then I never part with any advance payment. I strictly have them quote me for labour only. I buy sufficient materials for them to start work and only pay a proportion of each aspect completed e.g 75%. I read somewhere that you need to be able to hold onto enough money that they are sufficiently enticed to come back and complete the work to completion. If you part with too much there will be no more motivation on their part. Despite using this formula I still have contractors going off to start on new jobs just to get their foot in the door on their next project so they are not left with nothing when they are done. Fortunately all builds are my own so delays are at my own expense.

  • Real Estate Investor · Madison Heights, MI · Member since 2014 · 693 posts · 216 votes
    12y

    I have been dealing with contractors with my first flip. I tell them straight up what's expected from them. I ask for their license and I write down where they live and the license #.

    I meet these guys at the property after I have been working so sometimes they even see the gun I carry when I take off my hoodie.

    Remember you are in total control of the project and the money. They get no money until I check it out first. Being out of town would suck.

  • Wholesaler · Syracuse, NY · Member since 2014 · 120 posts · 8 votes
    12y

    that's horrible. I'm sorry you had to go through that, especially on your first rehab, but thanks for the prospective and advice. Would be nice if you had a picture of the guy, since with a grand larceny charge over his head he may have changed his name.

  • Investor · Oak Park, MI · Member since 2014 · 299 posts · 47 votes
    12y

    @Aaron McGinnis , I've been guilty of greed as well but I don't think it's accurate to say it's all greed. A couple of times I fell for the same story (although with not as bad ending as Mr Clanton) and it had nothing to do with greed, it had to do with desperation b/c I had no money left and also I had no idea about pricing.

  • Contractor · San Antonio, TX · Member since 2013 · 647 posts · 205 votes
    12y

    @Scott K. , great attitude; one thing I've learned with this whole thing is that I really need to get my laid back attitude in check. I've got a fuse about 50 miles long, and that comes across, even when I get going. It is definitely important to be clear that YOU are in charge of the deal

    @

    @Markeilsha R. , it's my understanding that the same guy pulled a variation on the same thing a few years back, which makes me think it's probably been ongoing. Amazing how some folks can slip through the cracks. Also, I have a picture, but I'm not going to post it on here until I get things a bit further along with law enforcement, things are a bit slow on that side.

    @Roy Gutierrez , I'm with you on that. Personally, my wife and I are just busy trying to get out of our 110-ish hour combined weeks and hang out with our one and three year old before they're all grown up. Everyone's got a story, and we all have a reason behind our investing.

  • Investor · San Antonio, TX · Member since 2012 · 28 posts · 27 votes
    12y

    Hey Chad

    Don't be too hard on yourself I am betting most Rehabbers that read your story have have been scam or lied too I know I have been

    One time I had a lady who convinced me to send her a bus ticket from Dallas to SA because she had been robbed, she was in the process of buying one of my flips. Once she got the 150.00 dollars from me I never heard from her again.

    Was I being greedy and simply choose to believe what this person told me was true? maybe...stuff happen in this business I like the fact that you are using this as a teachable moment

    Good luck

  • J ScottPro Member
    Moderator
    Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes
    12y
  • Investor · Peoria, IL · Member since 2014 · 76 posts · 44 votes
    12y

    Chad, reference dealing with law enforcement you and the other investors may want to hire a private investigator. One who is retired from the D.A.'s office or that particular department. Yours is a fairly complex fraud and most LE will try to push it off as a civil problem.

    The PI can wrap the whole case into a pretty package for LE so they don't have much work to do.... It's unfortunately the way it is.

    Unless you have the skills to do it yourself or if they have this guy already on their radar... Either way best if luck and thanks for sharing this, not always easy to do!

  • Contractor · San Antonio, TX · Member since 2013 · 647 posts · 205 votes
    12y

    @Steve Sanchez thanks for the recommendation, it's definitely something we're pursuing.

    @J Scott : yes, I've had your metaphysical voice in my head over the past few months telling me I should have done this or that differently, as well ;); I listened to your last podcast and kept thinking "yep, yes, that sounds familiar.... Yup, that happened too... Doh!" :-) Thanks for the link by the way, good stuff

  • Investor · Baltimore, MD · Member since 2014 · 1k+ posts · 688 votes
    12y
    "you either smoke or you get smoked...and you got smoked"
  • Contractor · San Antonio, TX · Member since 2013 · 647 posts · 205 votes
    12y

    @Account Closed it does certainly seem that way, though I think I'll refrain from smoking anyone else. That said, Woody Harrelson really is hilarious, and Wesley Snipes went to prison for tax evasion. Lesson learned there too, methinks ;-)

  • Investor · Schertz, TX · Member since 2014 · 70 posts · 13 votes
    12y

    Chad, Thanks for the warning. I'm here in the San Antonio area so I will definitely keep an eye out for him and ask around at some of my local REIAs if anyone knows of him and make sure to warn them, too. If there's something I can do to help out, feel free to reach out to me. It must be hard having to travel back and forth just to keep a watch on things. Live and learn.

  • Contractor · San Antonio, TX · Member since 2013 · 647 posts · 205 votes
    12y

    @Clint Weir , thanks for the offer. I know Bob was a member of and advertised with the Alamo REIA, and I know that they've been informed, but I'm not sure how widely the knowledge has been spread. My team down in San Antonio is a good one, and we've definitely all learned the pertinent lessons, but I'm still going to make a point to get down there every few weeks when I've got projects underway, at least until we get our fixes fully implemented. Take care Clint; would love to talk on the side sometime. Happy investing!

  • Investor · Baltimore, MD · Member since 2014 · 1k+ posts · 688 votes
    12y

    @Chad Clanton i deal with these fine people almost daily, two lessons i live by with them: never pay upfront money ever. No deposit under any circumstances. Dont want the job you say? Walk, 50 guys waiting to take your place. Want me to sign an agreement? No problem. But no upfront money. How will you buy materials? You wont, i will. That way you wont be stealing my money by upcharging me. What i offer you is labor only.

    Havent been screwed as a result, nor will you

  • Contractor · San Antonio, TX · Member since 2013 · 647 posts · 205 votes
    12y

    @Account Closed , thanks for that info, makes a lot of sense. I hadn't really considered that method, and it does seem a lot safer. A couple of the other things you mentioned are things I kick myself over going "seriously, did I really not think of that before?" Things do tend to be so much clearer in retrospect, though. Thanks for the perspective, I'll definitely keep it in mind going forward.

  • Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
    12y

    Chad , sorry you got burned . But from a contractor point of view , ( Based on Maryland home improvement law) Contractors are allowed to collect a 1/3 deposit , an second 1/3 when the job starts and the final 1/3 at completion. We must be licensed and bonded in Md . If we screw you you have recourse thru the commission that issues our license . I wont schedule a job without a signed contract and a deposit . If you want to supply materials , thats fine with me , I will still make the same money at the end of the job . How ? I get this once a month , a customer will get an estimate from me , then will say he has the materials , So I subtract materials from my bid , problem is I subtract MY cost of materials which is $ 700 and the customer says the materials are $ 1600. . I have to tell them thats what the materials are RETAIL , not my cost . I cant subtract what he paid , I cant give a full warranty since they were his materials , and if something is defective he will have to pay twice for the work .Professional contractors generally dont just work for labor , we dont put our money up for someones project . Unfortunatly you got burned by a contractor , but it works the other way around too , I know quite a few contractors that get burned by no pay customers .

  • Contractor · Atlanta, GA · Member since 2008 · 978 posts · 985 votes
    12y

    Argument as old as time. Investors want a fully licensed, professional, warranty-ready contractor who is willing to work for terms that ONLY a jack-leg chump would agree to. (No deposit, investor buys materials, contractor supplies only labor)

    There is a difference between a jack-leg chump, a con artist, and a professional contractor. Only a fool tries to paint with a brush so wide that they feel the need to treat all 3 the same.

  • Contractor · San Antonio, TX · Member since 2013 · 647 posts · 205 votes
    12y

    @Matthew Paul , thank you for the contractor's viewpoint, it definitely makes a lot of sense what you're saying, and it would be easy to see only the investor viewpoint. The part about the contract is particularly relevant, in that a contract is really about solidifying what is acceptable to both parties; sure, most tend to favor one or the other, but the bottom line is that both must agree to it, or it is non-binding.

    One issue with our situation is that he did a lot of work; the problem is, he was set to do the more expensive work (hvac, some more electrical, appliances, etc) last, so the final draws were still rather high, but they had to be bulk draws because you can't parcel out portions of an hvac system or things of that nature. That was where he got us, because he received those bulk amounts to acquire those expensive items, then bailed; it was only afterward when we pulled out the magnifying glass that we found all the hidden things that we have to redo.

    As to the licensing, well, failure to verify on my part. Personality won over diligence; that's purely on me. Furthermore, it's largely irrelevant where the license is concerned, because by all appearances he doesn't have the assets to square us all away anyhow, even if we won something in court. Lesson #1072 learned.

    Now, a question: one thing I intend to put in my contract going forward is a requirement for government issued ID, copy of the contractor license, and proof of insurance, as well as same for all subcontractors used, whether hired by me or the GC: how much resistance am I likely to run into asking for all of that, in your experience? Thanks for your input Matt, it has been very informative and is much appreciated.

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