Consumer complaint received 2017-08-30
Company: U.S. BANCORP
State: LA
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Struggling to pay mortgage

Complaint:
I am a survivor of a flood which took place in XXXX XXXX, LA in XX/XX/XXXX. I lost everything in my home. I had insurance for the structure of my home, but I became a victim of Contractor fraud. On XX/XX/XXXX, I called USbank to report I fired my contractor. The remainder of my insurance money which is the balance of {$26000.00} was immediately frozen the same day. I felt like I was being penalized for what the Contractor did. I reported my concerns to USBank on several occasions regarding my issues with the Contractor misappropriating funds, not completing repairs and I reported the work which the contractor completed was very sloppy. This is documented on a couple of the inspection reports, but the bank did n't do anything regarding my complaint. I also provided Loss Drafts with documentation that my Contractor lied about being a General Contractor. He held a commercial license which I found out expired XX/XX/XXXX, but he  worked on my house up until XX/XX/XXXX. He was in violation because he was not supposed to work on houses with damage over {$75000.00}. I also found out the paper work he submitted to the bank regarding his insurance was not valid. He only had insurance for one month which was XX/XX/XXXX, the policy cancelled XX/XX/XXXX due to non payment, therefore when he signed the contract with me XX/XX/XXXX, he did not have insurance as stated in his contract that was submitted to the bank. While working on my house this contractor had issues paying his employees and subcontractors. He also received money for permits and I later found out the fee was waived for flood victims.
In the beginning, the bank requested several documents to be verified for approval of the contractor before any of my insurance money was released. The contractor 's license expired the very next month after the contract began but he worked on my house three months after expiration. The insurance documentation provided by the contractor was not valid. The effective date of his insurance was XX/XX/XXXX but I found out it cancelled the very next month due to nonpayment, therefore he did not have insurance when he signed the contract with me in XX/XX/XXXX. If the bank verified the information which was requested for the contractor, they would have know this from the very begining. 

Due to the fact that the Contractor would not provide me with all receipts upon my request and his misappropriation funds, I acted in the capacity of my own General Contractor. I had to coordinate, manage and pay for subcontract work to be completed. The bank was informed of this as well and I provided a copy of all checks and receipts to the bank. 

After the contractor was fired, I was told by XXXX XXXX with USbank Loss Drafts dispute resolution that I would not be allowed to get another contractor until I sent two certified termination letters to the contractor at least 7 days apart from each other and I would have to send the return receipt to the bank. I was advised I could go to court to settle the dispute to have the funds released, ( this was not an option to me because this would have taken even longer to get back in my house ). It was also suggested that I try to work things out with the contractor. ( Why would I want to do that when I had already sent the bank confirmation of the fraud that took place with the contractor ). The only reasonable option I was given was to send the certified receipts. This process took two months because the fist certified letter never made it to it 's  destination, the other two copies of the termination letters mailed to the contractor was sent to his local post office and was held for 14 days because the contractor never claimed the letters. This is why it took close to two months to get both receipts. I was also told on two different occasions that anything I purchased while the account was frozen, would be reimbursed back to me. I returned the certified receipts from the letters sent to the contractor to USbank XX/XX/XXXX. My funds became available again, but I was then told that my money would not be returned because they wanted to make sure there was enough money to complete the house. The money that was owed to me was borrowed from a friend. This additional money did not come out of the insurance money, so this money should be paid back. I would have never used my friend 's money, if the bank would n't have told me the money would be reimbursed. 

As of today the contractor was reported to the Louisiana Licensing Board for Contractors and did not show up for the hearing but was fined the maximum penalty of {$10000.00} to be paid to the licensing board. He will also be facing criminal charges for Contractor fraud, his arraignment date in XX/XX/XXXX. In the meantime, I have been out of my house for a year, the floors which the contractor placed down has buckled due to the floors not being leveled. I was told by several contractors the wood floors in every room will need to come up. The sheetrock in every room will need to be repaired because nails are pushing through the sheetrock, because it was not installed properly and there is mold left in the house. The contractor treated the house for mold, but I later found out he was not licensed to treat the house for mold. It was stated on the contract that he was treating the house for mold, the bank never informed me that the contractor had to be licensed to treat mold. All of this is new to me, but the bank 's loss draft insurance department has been doing this for years. I was very disappointed that I did n't get any help regarding the fraud even after I reported that I was not satisfied with the contractor at the last two inspections and this is documented  on the inspection report. I would also like to add there is alot of work that was paid for in the house that was left incomplete by the contractor.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation