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Service Scams

Contractor fraud


Contractor fraud is an illegal act committed by a contractor involving the misrepresentation to a customer of services to be performed and/or a project to be done.  It occurs when an individual promises quick repairs or upgrades for prices that are either below or substantially higher than market prices. The fraudster offers a service that is done to deliberately cheat the other party and the work is usually substandard, unnecessary or may even cause damage to previously undamaged parts of a home. 


Fraudulent contractors typically use threats and intimidation and go after individuals, such as the elderly. The following are common tactics and techniques used in contractor fraud:

  • Knock on your door to tell you they're "working in the neighbourhood" and can give you a special price
  • Provide a quote without conducting a site visit 
  • Requiring payment up front
  • Written contracts that do not include verbal agreements
  • Contractors not getting the right permit
  • Contractors reveal unforeseen problems that need extra work
  • Selling extra materials to you for a cheap price
  • Will not commit to a start and/or completion date

There are simple steps homeowners can take to insure that they do not fall victim to these tricks. The following are questions and steps you should take when dealing with contractors:

  • Get multiple estimates in writing
  • Check references
  • Check qualifications
  • Ensure the company has WCB coverage (ask for their WCB number)
  • Check the Better Business Bureau for any complaints 
  • Paying up front: legislation in Alberta states contractors can't ask for ANY money until the work is done - unless they have a prepaid contractor's license with the province.
  • Verbal and written agreements: Make sure everything you want and agree to is in the final contract.
  • Getting the right permit: Request that the contractor get a builder’s permit because this will protect you from unlicensed contractors.
  • Unforeseen problems and extra work: Make sure the contract requires that the homeowner and contractor must both sign before anything is charged or worked on.
  • Selling extra materials at a cheap price: Do not buy services or materials on the spot or on an impulse, always do your research and make sure the contractor has a good reputation.


It can be difficult to differentiate whether or not contractor scams are criminal or civil.

The key elements for the scam to be criminal are that:


  1. The individual or fraudster used:
    • Deceit - concealment or distortion of the truth for the purpose of misleading;
    • Falsehood - a false statement or a lie;
    • Fraudulent means - being dishonest or cheating a person.
  2. To defraud them of:
  • Any property
  • Any service
  • Money

If your contractor ‘scam’ does not meet the key elements to be criminal, please contact Consumer Investigations Unit (CIU) of Service Alberta.  In these circumstances Service Alberta may investigate the file. CIU of Service Alberta investigates breaches of consumer protection legislation. The main focus of the investigation is to make sure Alberta’s consumer protection laws are being followed. At the end of the investigation, the investigator may recommend further action based on the facts of the case.  Which may consist of:

  • issuing a warning to the business or individual
  • under certain legislation, make recommendations for licensing actions, administrative penalties, undertakings and Director’s Orders.

Contact Consumer Investigations Unit (CIU) of Service Alberta at: