Contractor Fraud Rose 38% in Two Years and the Pattern Is Always the Same

The number itself is alarming: a 38% increase in reported contractor fraud across North America between 2023 and 2025, according to the National Insurance Crime Bureau. But the number isn't the most useful part. The pattern behind it is. Whether the case involves a Saskatchewan contractor who took $50,000 in deposits and never started the work, or a Minnesota operation that forged supplier invoices and faked progress updates to keep families paying, the script is remarkably consistent.

A contractor makes contact. A deposit is requested. Work begins slowly or not at all. Excuses follow. By the time the homeowner realizes what's happening, the money is gone and the legal options are limited. The BBB's 2024 Scam Tracker Report ranked home improvement as the third riskiest scam category in Canada, with an 83.9% susceptibility rate. That means nearly 9 out of 10 people who encounter a renovation scam fall for it.

Understanding why that rate is so high requires understanding the pattern itself.

The Same Script Played Out Three Times This Spring

On June 6, 2026, Regina police arrested Jeremy Jordan, 47, and charged him with fraud over $5,000, criminal breach of trust, and laundering proceeds of crime. According to CJME, multiple homeowners had hired his company, Sask Abatement, for residential renovation, abatement, landscaping, and construction work between April and September 2025. After receiving deposits via bank draft and e-transfer, some projects were never started, others were left unfinished, and requests for refunds were ignored. Total reported losses exceeded $50,000.

A month earlier, EMR Renovations issued a public warning that renovation fraud in the Greater Toronto Area was "still spiking" as spring projects ramped up. The cases they cited followed the identical script. In Ajax, a homeowner paid $18,000 to a roofing company and was then pressured for another $50,000 by a non-legitimate firm. Peel Regional Police reported $37,000 in deposits lost to work that was never performed. And in a single case involving two Toronto-area victims, $296,000 disappeared through a home-renovation fraud scheme involving mortgage funds and bank drafts.

In Hamilton, police issued an alert in March 2026 about roofing contractors who were deliberately damaging roofs to convince homeowners that repairs were needed, then charging for fraudulent work. The common thread across all of these cases: unsolicited contact, prices that seemed unusually attractive, high-pressure sales tactics, and a demand for large deposits before any work began.

Why Renovation Is Uniquely Vulnerable

Most consumer purchases come with built-in guardrails. If you buy a defective appliance, you return it. If a restaurant charges you for food you didn't order, you dispute the charge. Renovation doesn't work that way. You're paying for a future outcome, often in large increments, with limited ability to evaluate quality until the work is finished.

That structure creates three specific vulnerabilities.

Verification is optional. In most Canadian provinces, there's no mandatory licensing requirement for general contractors. Ontario requires contracts over $50 to be in writing, but there's no provincial licensing body that vets qualifications before a contractor takes on work. Quebec is the exception, requiring licensing through the Régie du bâtiment du Québec. In Alberta, Service Alberta publishes consumer guidance on hiring contractors, but the framework relies heavily on the homeowner doing their own due diligence.

Payment flows forward. Deposits are standard in renovation. A contractor needs materials and often needs to schedule trades. But the structure of the transaction means money moves from the homeowner to the contractor before most of the value is delivered. In the Regina case, deposits were made by bank draft and e-transfer, both of which are difficult to reverse once sent.

Scope is ambiguous. When a homeowner says "I want my kitchen renovated," that can mean anything from a $15,000 cosmetic refresh to a $70,000 structural overhaul. Without a written scope that defines exactly what the project includes, there's no baseline to measure against. The contractor and the homeowner may have entirely different understandings of what was agreed to, and without documentation, the homeowner has no leverage when the project stalls or the price inflates.

The Fraud Gets More Sophisticated

The Minnesota Attorney General's office demonstrated just how far the script can go. In January 2026, AG Keith Ellison obtained a $2.6 million judgment against Earl Christian Rode IV and his company, High Road Builders LLC, for defrauding 10 Minnesota families out of a combined $1.3 million.

Rode didn't just take deposits and disappear. He falsely claimed to hold a contractor's license when he'd already been banned from claiming licensure. He forged invoices from genuine third-party suppliers, making it appear that materials had been purchased. He provided fabricated progress updates to keep clients paying. In some cases, he performed only basic demolition before vanishing with the funds.

The sophistication matters because it defeats the most common advice homeowners hear: "Check reviews" and "ask for references." Rode had real conversations with real clients, used real supplier names on fabricated documents, and maintained the appearance of legitimate work long enough to collect payment. The pattern only broke down after multiple families compared notes.

How to Structure a Renovation That Doesn't Follow This Script

The fraud pattern depends on three conditions: the homeowner can't verify the contractor's credentials independently, the payment structure is front-loaded, and the scope is undefined. Remove any one of those conditions and the script falls apart.

Verify credentials through the licensing body, not the contractor. In Quebec, check the RBQ's online registry. In other provinces, confirm that the contractor carries valid liability insurance and workers' compensation coverage by contacting the insurer directly. Ask for a copy of the policy, not just a policy number. A legitimate contractor won't hesitate to provide it.

Insist on a written scope before any money changes hands. This isn't a wishlist or a Pinterest board. It's a document that specifies dimensions, materials, finishes, timelines, and exclusions. When three contractors are quoting against the same written scope, you can compare their numbers line by line. Without it, you're comparing different projects at different prices and learning nothing from the exercise.

Structure payments around milestones, not trust. A reasonable payment structure for most residential renovations is 10% to 15% as a deposit, progress payments tied to completed milestones (demolition complete, framing inspected, fixtures installed), and final payment on completion and walkthrough. Any contractor asking for 50% or more upfront on a standard renovation warrants scrutiny. Front-loaded payment schedules are the single most consistent red flag across every fraud case cited in this article.

Get everything in writing before work begins. The quote, the scope, the payment schedule, the timeline, the warranty terms, and the process for handling changes. If the project changes after signing, document the change order with a revised price and get written agreement from both sides before the new work starts.

The 38% increase in contractor fraud isn't a reason to avoid renovating. It's a reason to structure the renovation so that the conditions fraud depends on don't exist. Define the scope. Verify the credentials. Tie payments to work completed. The pattern only works when you don't see it coming.

Sources

Source	Data Referenced
National Insurance Crime Bureau (NICB)	38% increase in reported contractor fraud from 2023 to 2025, common fraud schemes including manufactured damage and inflated claims
CJME / Regina Police Service	Jeremy Jordan / Sask Abatement fraud charges: fraud over $5,000, breach of trust, money laundering, $50,000+ in losses (published June 6, 2026)
Newsfile Corp / EMR Renovations	GTA renovation fraud warning: $296,000 lost by two victims, $18,000 Ajax roofing fraud, $37,000 in Peel deposits lost (published May 14, 2026)
CP24 / Hamilton Police Service	Hamilton roofing scam alert: deliberate roof damage by contractors, unsolicited door-to-door tactics (published March 20, 2026)
BBB Scam Tracker Report (2024)	Home improvement ranked No. 3 riskiest scam in Canada, 83.9% susceptibility rate (cited in EMR Renovations / Newsfile release)
Minnesota Attorney General's Office	$2.6 million judgment against High Road Builders LLC: 10 families defrauded of $1.3 million, forged invoices, fabricated progress updates, false licensing claims (published January 28, 2026)

This article is for general educational purposes only and does not constitute legal advice. buy better® does not provide contractor recommendations, background checks, or licensing verification services. The cases referenced in this article are drawn from publicly reported law enforcement actions and news sources. Consumer protection rules vary by province and state. Consult Service Alberta, the Ontario Ministry of Public and Business Service Delivery, or your provincial consumer protection office for guidance specific to your jurisdiction.