Construction fraud is real, and it happens more frequently than one may thing. Construction companies and contractors can lose big money on this fraud. Fraud, especially at first, can be hard to spot, especially if a company has many employees, suppliers, and job sites. Often, an owner does not realize the fraud is occurring until it is too late.
We wanted to share with you the different types of fraud owners may have to deal with in the construction industry:
- Time fraud – Workers can show up late or leave early or take too many breaks – this is stealing time and slowing down productivity. Over time, this can lose the company money. Workers will usually write down/punch in times they were working when they were not, so they’re getting paid for work and hours they did not do. Employers can fight this by installing security cameras near time clocks.
- Fake injuries – Some employees have been known to fake injuries to get paid (with workers’ compensation) without having to work. These fake injuries can cause a company’s workers compensation benefits rates to increase. Just like the time clock, cameras can prove if an employee did actually harm him/herself.
- Bills for no work – Some subcontractors will bill the contractor for work and time they did not to. They can say they worked more hours than they did, say they used equipment and tools when they didn’t, and say what they completed, and they didn’t. to fight this, it’s best to hire a licensed, well-respected subcontractor. It’s a good idea to hire someone you know already or know through someone else – this will reduce your chances of being robbed.
- Stolen equipment. Whether it’s a machine or tool, stolen equipment can cost a contractor thousands. To combat this, GPS trackers on devices and security cameras can potentially track down the thief.
To avoid fraud before it happens, think about conducting background checks, have people in the company monitoring fraud, reviewing invoices, etc. not all fraud can be avoided, but there’s a lot you can do to prevent it or stop it right in its tracks.
Ready to be a contractor? You will need to get your contractor license. As a contractor licensing company, we have helped thousands of contractors across the United States get their contractor license, and we want to help you too. First, you provide us with some basic information on your skills, background, testing, education, etc. Then, we will fill out all the paperwork, let you know if you are missing anything, have you send us the correct/new info, finish up the application, and submit it to the Board on your behalf to get you approved. We know all the requirements and deadlines.
To get your contractor license, click our Florida contractor’s license page to learn more and get started with us or call 239-777-1028.