Fraud Scam - Construction Scams - Hager Construction Services, Inc., Hager Construction Services, Hager Construction, Contractor's License no: 855321 Greg Hager, Gregory James Hager, 1240 Fitzgerald Street, #212 Rialto, CA 92376 Home Address: 3372 N. Orangewood Rialto, CA 92376, Eugene Childress, Childress Construction 2317 W Calle Vista Dr., Rialto, CA 92377, Robert V. Mayhall, Mayhall & Associates, LLC, 9421 Haven Avenue, Suite 210, Rancho Cucamonga, CA 91730
Hager Construction Services, Inc. Was contracted to build a custom home and failed to honor the contract, mishandled project funds and acted completely in bad faith. The companies' principals / partners were comprised of Greg Hager, Eugene Childress and Robert Mayhall.
Hager started construction on a custom home without following the city approved plans and specifications and submitted fraudulent invoices for work that had not been completed. Total payments made to Hager were $182,000 of which $95,000 was stolen from the project and only $86,000 was used towards the actual project. Further, 90% of the $86,000 Hager used on the project needed to be reworked at an additional expense of more than $100,000. Additional losses for carrying costs bring the total loss we sustained to over $400,000.
This case was reported to the Rialto Police Department as multiple Criminal Frauds. Detective Massey has been assigned to this case # 930808971. If anyone else experienced problems with Hager Construction, its principals or sub contractors listed herein, you are encouraged to contact Dectective Massey of the Rialto Police Department at 909-820-2524.
Claim number SF 2008 2357 was filed with the Contractors State License Board of California, which Hager failed to respond. The case has been handed over to Enforcement Officer / Investigator Lisa Brewer 909-890-2205. Also, Hager's surety bond was cancelled.
It was contractually agreed that Hager set up a dedicated bank account for the project so the funds could not be comingled, which they failed to do. We believe the funds were comingled with other projects and with Hager's personal banking.
The project was started by Hager and before getting up to slab, we found all kinds of major non compliance issues and other related problems. Upon becoming aware of all the problems, we decided to terminate Hager. Weeks were spent trying to sort out the mess left behind. Virtually all the work completed by Hager had to be completely redone.
One of the multiple criminal frauds we claim Hager committed was an invoice submitted by Paul Bunch of Victory Electric (located in Victorville, CA) for $23,000 which we fully paid and no materials were ever delivered or any work started. Hager claims Victory Electric received the funds and failed to deliver. Paul Bunch of Victory Electric would not respond to our certified mail, emails or phone calls requesting his testimony of what happened to our $23,000. We truly believe that Hager and Victory Electric conspired to commit this act of criminal fraud.
Here are a few of the major construction related issues we found:
1. All the moment frames were installed incorrectly by Craig Yates of So-Cal Structural Steel Fabrication, Inc. (also located in Rialto, CA). They were completely off by as much as one foot in certain areas. To make matters worse, Craig Yates of So-Cal Structural Steel Fabrication, Inc. Admitted he notified Hager of the improper locations and So-Cal Steel was instructed by Hager to install them regardless of being correct or not. That said, both Hager and So-Cal Steel demonstrated a willful disregard to comply with the plans and decided to do things which were NOT approved by the architect, structural engineer, the city, any city inspector or other governing agencies.
2. All of the forms had to be removed as most of the forms were installed improperly and again were off by as much as two feet in certain areas. Most of the forms were either warped, cut short or long, were not square or plumb and completely installed wrong.
3. All of the grade beam and footing rebar was not formed per the specific plan details and had to be removed and replaced. As installed by Hager, none of the work would pass any of the required City or Deputy inspections.
4. One large footing was dug incorrectly and off by one foot (or more). This footing has to be increased in width and the moment frame adjusted accordingly.
5. The moment frame footings were poured without rebar.
6. All of the interior structural steel footings were completely off alignment which could be seen with the naked eye (as much as a foot or more). Looks like an inexperienced drunk person installed them.
7. The pad was 24" lower than approved for slab. Dirt needed to be added in order to make the area level and to the correct grade before the slab was poured.
Bottom line, virtually everything Hager did on the project was done improperly, without regard for complying with the approved plans and such actions appear to be intentional just for the sake of making it appear that progress was being made solely for the purpose of gaining progress payments. None of the existing work would ever pass any inspections and in the off chance it did, walls would be built outside the building envelope, plumbing would be in the wrong locations, windows and doors would not fit per plan, framing for both the roof, interior and exterior walls would be next to impossible to build as nothing aligned. None of this is exaggerated and is factual as supported by photos and professional testimony.
To make matters even worse, Hager failed to pay its subcontractors whom now are trying to collect funds from the project. The extent of this damage is still unknown. The acts by Hager are appalling. Hager was paid to provide materials and labor as per the approved plans. Hager did not build in accordance with the approved plans, failed to deliver materials that we paid for and kept $95,000 for its own personal benefit.
Greg Hager acknowledged the missing $95,000 and said the CFO (Robert Mayhall) was hired to manage the project funds which went missing under his control. Upon confronting all three of them separately about the missing funds, they pointed the finger at each other. Greg Hager said he would make good on returning the money, but instead makes no attempt and completely ignores phone calls and emails.
We sustained major damages as a result of a willful and deliberate violation of California Contractors License Law by the licensee (Hager Construction) and alleged fraud of the licensee and its sub contractors in the execution or performance of a construction contract for a single family residence. We will be very happy to see these low life dirt bags sent to jail for fraud. It's where they all really belong.
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