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Friday, Aug. 19, 2005
Home renovation scams causing alarm
Wider use of guardian system pushed as flimflam artists prey on elderly
By ERIKO ARITA
Reports of home renovation fraud have been coming out of the woodwork ever since the media reported that two elderly sisters with dementia were duped for 50 million yen in unnecessary repair work and almost lost their home in an auction to pay for the scam.
Like the Saitama Prefecture sisters, aged 80 and 78, many victims of repair scams are senior citizens who live alone and are targeted by slick salespeople from renovation firms.
On Thursday, the National Police Agency reported that the number of people victimized by home-renovation fraud reached about 8,200 nationwide in the first half of the year, with total damages hitting 11.9 billion yen.
Tokyo has also seen a rise in home repair scams, with complaints reaching 1,866 cases in fiscal 2004, up from 1,304 in fiscal 2000, according to the metropolitan government's Comprehensive Consumer Center.
The rise in home-repair scams has alarmed local governments, which are boosting measures to keep an eye on elderly residents. But many experts are recommending wider use of the legal guardian system, which protects the assets of the elderly.
Grifters come calling
The sisters' home in Fujimi, Saitama Prefecture, was put up for auction to pay for contracts they unwittingly signed with 19 companies for repairs -- many unnecessary -- made to their dwelling, according to municipal officials.
Takahiko Ishida, a certified architect who inspected the house at the city's request, said more than 100 pieces of reinforcement equipment were found under the roof, though only about 10 were actually needed.
"I was shocked when I looked under the roof," Ishida said. "It was like a reinforcement hardware fair."
More surprises were found under the floorboards, where humidity controlling material was found to be some 20 cm thick, even though just 3 cm suffices, he said.
While the companies demanded the sisters pay some 50 million yen, the cost of the actual work was 17 million yen, Ishida said, adding that the same work would usually cost just 4.8 million yen.
The fraud came to light in March, when a neighbor told city officials that the sisters said they had been told to vacate their home because it was being put up for sale, according to Shinichi Shiseki, chief of the city's consumer section.
After Ishida inspected the house, the city asked the Saitama District Court to suspend the auction and applied with the Kawagoe branch of the Saitama Family Court to appoint a lawyer as their guardian to recover their lost assets.
Reports of similar repair fraud cases are on the rise in the city, and many involve the elderly, Shiseki said.
Threats and scare tactics
A typical sales tactic is to offer free inspections and tell the owners that repairs are needed to prevent their home from collapsing during a major earthquake, said Akika Miki, chief of the center's consultation section.
"The salesmen entice consumers to sign (renovation) contracts by taking advantage of their anxiety," Miki said.
"Such salespeople also repeatedly recommend making more renovations, and consumers are swindled out of a lot of money in the end," she said. Consumers should be especially careful when salespeople pitch that something is "free" or "a bargain," she said.
Companies target the elderly because their physical and mental capabilities are on the decline and they are easily deceived, Miki said, adding that many of the consultations involved the homes of seniors who live apart from their offspring.
Architect Ishida said many elderly people he met who were swindled by renovation scams said the sellers were "good people," and added that seniors who live by themselves feel isolated.
"The salesmen took advantage of that loneliness."
To deal with the problem, the city of Fujimi plans to ask caregivers who visit recipients of public nursing-care insurance services to help, said Takuo Shono, head of the city's elderly welfare section.
"If the senior citizens are receiving the services, caregivers will inform the city if they find problems," he said.
However, the sisters in Fujimi, who are single, had declined nursing-care insurance services, Shono said, adding that the city plans to ask local welfare commissioners to keep in regular contact with such residents.
Another part of the problem is cultural. The tightly woven web of personal connections that used to be the hallmark of communities is rapidly becoming a thing of the past.
As interaction among neighbors declines, it has become increasingly difficult for authorities to find residents in trouble and help them, according to Hisao Shirato, of Saitama Prefecture's aging society policy division.
In late July, the prefecture established a network for finding elderly people in need, including solutions to home renovation scams.
The network comprises of organizations in different fields that come into contact with senior citizens on a relatively regular basis, such as nursing-care providers, utilities and newspaper distributors.
Guardian system advised
Shuzo Taniai, a lawyer specializing in house construction problems said more use should be made of the legal guardian system.
Launched in 2000, families of adults incapable of making responsible judgments due to reasons that include dementia can apply to a court for the appointment of a guardian. Under certain circumstances, municipalities can also make the request.
If an elderly person with a guardian signs a contract with a home renovation company, the contract would be invalid, and the customer would have the right to reclaim any money paid, Taniai explained.
But the system has not come into wide use, partly due to lack of effort to promote it, experts say.
"In fact, not even many local government officials know the system well," said Minoru Maeda, a judicial notary specializing in the guardian system.
According to the Health, Labor and Welfare Ministry, only 509, or 3 percent, of all applications requesting guardians were filed by municipalities in fiscal 2004.
Maeda suspects local government officials tend to be reluctant because the application procedure is complicated and they are afraid of getting involved in family conflicts regarding seniors' assets.
"But unless senior citizens have guardians and are cared for (within their communities), they will continue to be victimized by fraud scams," he said.
Late last month, the welfare ministry simplified the application procedure by limiting the scope of relatives needed to approve the municipalities' request for a court-appointed guardian.
The elderly have always been a prime target for swindlers, experts say, and new and more innovative scams will evolve.
If approached by people pitching renovation work, homeowners should contact their local consumer centers to learn if a firm has been penalized for engaging in dubious practices.
"In addition to restricting (pernicious) businesses and imposing more stringent rules on consumer contracts, we also need more fundamental support for the elderly and people with disabilities, who are often targets," Maeda said.