By Sarah Phelan
Lennar has been giving contractors a choice between a rock or a hard place: reduce your unpaid invoices by up to 20 percent—or be excludedfrom bidding work for a minimum of six months. Nice, real nice.
Marc McGuire, a tile contractor from San Diego, and CALPASC’s Brad Diede on CNBC yesterday to discuss accusations that Lennar is extorting contractors
Three top Lennar executives sent these demands to contractors in Southern California in a letter dated January 16, 2007. So far, no similar letters have emerged locally, but that doesn’t mean similar demands haven’t been happening here, warns Brad Diede. Diede is executive VP of the Sacramento-based California Professional Association of Specialty Contractors, which represents 500 trade contractors and construction suppliers nationwide.
Outraged, Diede fired off a letter to Attorney General Jerry Brown, in which he wrote,
“We believe this potentially criminal act is a flagrant example of the abuses of power builders exercise over trade contractors in the State of California.”
But so far, Lennar has not been found guilty of civil or criminal violations in this case.