[co-author: Stephanie Kozol]*
On August 10, Michigan Attorney General (AG) Dana Nessel issued a press release to report the success of the new Unlicensed Builders Pretrial Diversion Program that was launched in February. AG Nessel launched the new program to promote licensing compliance, ensure restitution to victims, and efficiently resolve cases of Michigan consumer complaints of harm caused by unlicensed builders in the state.
Operating without the requisite builder license in the state of Michigan is a crime. Since 2020, cases of unlicensed builders have significantly increased. In 2022 alone, the AG’s Criminal Trials and Appeals division handled more than 200 misdemeanor unlicensed builder cases.
However, the Unlicensed Builders Pretrial Diversion Program allows unlicensed contractors to participate in mediation while avoiding criminal prosecution so long as they quickly comply with state licensing requirements and fully reimburse the complainant. To be eligible for the program, the builder must not have any prior violations of the unlicensed builder statute and the restitution owed must be less than $10,000. Once the builder is accepted into the program, the AG will close the criminal complaint against the builder, without pursuing criminal charges if: (1) full restitution has been paid to the victim; and (2) the builder either proves they are no longer working in the field requiring licensure, or they come into full compliance with all licensing requirements set by the Department of Licensing and Regulatory Affairs.
Since the program launched, it has secured $72,500 in restitution to Michigan residents. AG Nessel reports that, “[t]he Unlicensed Builders Pretrial Diversion Program has been very successful over its first few months, securing tens of thousands of dollars in restitution to consumers harmed by substandard and unlicensed contractors. This program has proven to be effective in tackling the uptick in unlicensed builder cases we have seen in recent years and is working to resolve these issues without criminal trials in the courts requiring further resources of the state. I am very thankful to the attorneys in my department’s criminal trials and appeals division for all of their hard work in establishing this program and securing justice for Michigan consumers.”
Why It Matters
The Unlicensed Builders Pretrial Diversion Program is an unexpected initiative launched by a Democratic AG because it affords businesses the opportunity to evade prosecution should they satisfy the program’s requirements. We will continue to monitor AG Nessel’s activity to see if similar initiatives are rolled out for other industries apart from construction.
*Senior Government Relations Manager
