Office of the Attorney General
Attorney General, Mayor: Avoid Flood-Related Scams
Mayor Jerry Abramson and Attorney General Jack Conway warned Louisville residents to be vigilant against fly-by-night repair crews, bogus charitable collectors and fake officials – scams designed to exploit people recovering from disasters like last week’s flash flooding.
"It’s unfortunate that some unsavory characters will always try to take advantage of a community’s misfortune," Abramson said. "It’s important to take the time to ensure the people hired to repair your home or inspect your property are legitimate."
Abramson and Conway offered a series of tips for consumers to avoid scams and sub-par repair work.
"I appreciate Mayor Abramson partnering with us to help educate consumers about the risks they face after catastrophic flooding like we’ve seen in Louisville," General Conway said. "It is our mission to protect residents from ‘storm chasers,’ out-of-state repairmen who travel across the country following disasters and looking to scam storm victims."
Common natural disaster scams include outright fraud, shoddy construction, charity scams, impersonating officials, and loan scams.
Storm Repair Tips for Consumers
- Never pay in advance for labor. Scam artists often take advance payments from consumers and never return to complete the work.
- If possible, use local, reputable contractors for repairs.
- Ask if the contractor is licensed, bonded (if required by the city or county) and insured.
- Check unknown companies out with the Better Business Bureau (Louisville/Western KY 1-800-388-2222; Lexington/Eastern KY 1-800-866-6668) or call the Consumer Protection Division 1-888-432-9257 to see if information is available about the company.
- Demand a written contract. If possible, get estimates from several contractors.
- Be suspicious of unfamiliar, out-of-state vehicles and those who offer repair work at unreasonably low prices. Contact local law enforcement about your suspicions.
- Call the Consumer Protection Hotline at 1-888-432-9257 or file a Consumer Protection Complaint at ag.ky.gov/cp to report any incidents of possible fraud or shoddy construction work and repair.
Another issue residents are dealing with is flood-damaged vehicles. Once a vehicle is flooded, the owner’s insurance company typically settles a claim by buying the vehicle and selling it at auction. Fraud can occur when auto sellers purchase damaged vehicles, mask the water damage and resell the vehicles.
"I want residents to know how they should handle dealing with flood-damaged vehicles and how to protect themselves from purchasing damaged vehicles down the road," General Conway said.
Tips for People with Damaged Vehicles
- Check your oil. An oil level that is too high may indicate water in the engine. Do not start or run your car, it could cause severe damage. Contact your insurance company immediately.
- Comprehensive coverage of a vehicle covers flood losses.
- If you have a loan, notify your lender of the damage.
- Act quickly to determine the vehicle’s current NADA average prior to the flood damage. Owners will need to know this when dealing with an insurance provider or lender.
- Determine how high the flood water reached on your vehicle. If the water reached the midpoint of the tire, there may be severe damage to electrical systems generally located along the bottom of the floor. Some experts consider the vehicle a total loss if this area is flooded.
- Get a written estimate of the damage – this will prove useful in dealing with the insurance company and if the owner sells the vehicle later on.
- If the owner is considering retaining and using the vehicle, have it thoroughly inspected for safety.
- When selling the vehicle, always disclose the past water and other damage. Failure to disclose that could subject the seller to legal liability.
Kentucky requires titles to be branded as "water-damaged" or "salvaged;" however, an unscrupulous dealer may obtain fresh documentation that hides the vehicle’s history and damage. When searching for a used car, always fully inspect the vehicle and look for signs of flood damage.
Signs of Flood-Damaged Vehicle
- Look for watermarks along the body and seams and for traces of dried mud, particularly under the dash.
- If carpeting has been replaced, be suspicious. Look for signs of improper fitting or color matches to determine if the carpet has been replaced.
- Note discolorations in upholstery.
- Look at the engine and its electrical parts. Pull back rubber boots around electrical and mechanical parts.
- Inspect for grit in alternator crevices, behind wiring harnesses, and flaking metal along the undercarriage.
- Check switches, gauges and indicator lights for proper functioning.
- Check vent system and air/heat mechanism. Turn off and on several times. Notice any smell of mildew or other flood indicators.
- Look in trunk and spare-tire well for mud residue, as well as head lamps and other lights.
- Are screws rusted in the console, glove box or interior panels or other areas that normally would not be exposed?
- As with any used car purchase, do business with a reputable dealer and have the auto inspected by a reputable mechanic BEFORE you purchase.
Prevention is your best protection to avoid used car purchase problems. If you have questions or need to file a complaint, contact the Attorney General's Consumer Protection Hotline at 1-888-432-9257 or visit ag.ky.gov/cp.
Kentucky Division of Motor Vehicle Licensing http://transportation.ky.gov/mvl/titles/title_inquiries.htm