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‘Fake’ construction scams defrauding customers online 

02 Aug 2022

  • Victims complain of poor quality construction, threats  
  • CIDA requests documentation of evidence to intervene 
BY Dinitha Rathnayake  The incidence of construction-related fraud – where fraudulent, so-called construction companies advertise their scams on social media, including by employing “fake” agreements drafted with assistance from attorneys – is on the rise. An investigation by The Morning revealed that such fraudulent construction companies use social media platforms, mainly Facebook, to advertise their services, where these parties claim to have their own construction companies and have prepared “fake” agreements with the help of lawyers. Many people, The Morning learnt, have been duped by such scams. Speaking to The Morning, T. Samaranayake (name changed on request), said: “I found a construction company called Amali Engineering (Pvt.) Ltd. through Facebook, with the registration number PV 106195. The owner is Sachintha Dulanja holding the national identity card number 801980643V and is a resident of Piliyandala. We came to an agreement in May-July 2020, and according to the agreement, he had to finish construction by December of that year, which he never did.  “He had created the illusion of a construction firm using several Facebook pages such as Amali Engineering, Green Ladder Homes Constructions, Niwahana Homes Engineering, and Soduru Gedara. For almost one and a half years, I have been trying to get them to complete the construction of my house. He is a liar, a cheat, and an unprofessional person. He’ll paint a wonderful dream until he takes the money, but once he receives two to three instalments, you will not be able to locate him as he won’t even pick up the phone.  “Sometimes, he’ll make many excuses, such as his wife being sick or that she has run away, or that his mother or father is sick. He even uses his kids for excuses, where he’ll say that he can’t feed his kids and to, therefore, please give some extra money. Even today, I’ve been arguing with him to at least start the work, but he doesn’t have a fixed team to take on his commitments.  “I paid more than the agreed cost as I want to finish this fast, but nothing is moving forward. My project was signed in May 2020. The project started in July 2021. The project location is in Kurunegala. It was planned to be completed in December 2021. The payment made is 75% of the estimated project cost but what has been completed is less than 50%.“  According to The Morning’s investigations, there are several complaints to the Police related to the said individual named Dulanja and his fraudulent construction agreements. “So many people have been affected by this fraud, and I’m therefore trying to create awareness about this company through Facebook,” one complainant named Lakmali said. “He uses low-cost interior items and the quality of the constitution is also low,” another complainant named Chiran noted. According to the complaints seen by The Morning, the person named Dulanja has also threatened people by claiming that he has connections with organised criminal elements. Attempts to contact Dulanja on this matter proved futile. Meanwhile, Attorney-at-Law Prof. Prathiba Mahanamahewa, speaking to The Morning, said that there has been an increase in the number of fraudulent, unlicensed construction firms operating in the home building sector. Many of these construction companies use social media platforms to promote their businesses while misleading their customers. Prof. Mahanamahewa said that this is a trending issue at the moment. “I received many complaints related to construction companies, where some of my clients have paid the full amount of money for the relevant construction to build their dream homes. However, after receiving the money, these construction companies have not completed their work according to the agreement. This needs to be stopped,” he stated. According to Prof. Mahanamahewa, customers should ideally conduct a background investigation before they sign an agreement with construction companies. Construction companies that are involved in projects worth above Rs. 10 million have to be registered under the Institute for Construction Training and Development, which is presently the Construction Industry Development Authority (CIDA). However, some small-scale companies in the field do not have this registration. “If the company is not registered under the CIDA, it is better to lodge a complaint with the evidence you have, such as the contract, payment receipts, etc. If not, most of the cases go under the civil law, and not in favour of the customer,” he said. Further, he said that customers could file a case under a breach of the agreement; however, if the customer has received a bounced cheque from a construction company, it is easy to file a case under criminal law, since it constitutes fraud. Prof. Mahanamahewa also stressed that it is essential to have a monitoring system under the State Ministry of Rural Housing and Construction and Building Materials Industries Promotion.  “There should at least be a place to investigate complaints, and establishing a construction ombudsman is essential in this regard,” he urged. A customer who had signed an agreement with such a fraudulent company noted that these firms attract customers by offering low prices.  “If you can build a house for a low cost, that’s all you can ask for. We fell for the price that they offered. These construction companies tend to sign agreements with lawyers as witnesses,” they stated. “Construction work on the first few days was interestingly quick; however, afterwards, most of the customers will notice delays in construction.” Since the agreements to be signed with these construction companies are drafted in favour of the company in question, most customers are left unable to take further steps against them. Some customers have paid the full amount for the construction after procuring loan facilities from banks, while some have paid half the required sum for construction. Most of these construction companies use a third party, where they hire small or medium-scale contractors to do the job. A CIDA official told The Morning that if a customer has the proper documents to prove their case, the authority would be able to intervene and solve the issue.


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