Maryland builder ordered to refund consumers for houses never built

McDaniels Homes to pay restitution.McDaniels Homes, a Maryland homebuilder, has been ordered to pay fines and refund consumers after the company took money for house downpayments, but either never broke ground or completed the houses in some cases, state Attorney General Douglas F. Gansler said.

Gansler said his office's Consumer Protection Division has ordered McDaniels Homes of Prince George's County and its owner, Derek A. McDaniels, to pay $448,830 in restitution to consumers, civil penalties of $87,000 and other costs totaling $4,027 for violating the five state laws including its consumer protection rules. The state says the homebuilder allegedly took money from at least 10 families toward new home construction but didn't place that cash in a secure account or have enough of a surety bond to cover the payments. The state also charged that construction on those homes either didn't start or was never completed and none of the consumers were refunded.

Neither McDaniels Homes nor its owner could be reached by Consumer Ally for comment. The business phone has been disconnected and a home phone number for McDaniels plays a recording saying he's not accepting calls.

"The law in Maryland is very clear: home builders must properly handle consumer deposits and they must honor their commitments to home buyers," Gansler said in a statement. McDaniels Homes and its owner will be barred from doing business in Maryland unless they meet the division's requirements in its order.

Homebuilders must be registered in the state and consumers can check up on a business before putting cash down on new construction through the state's website. Maryland also has a booklet you can download that offers tips on hiring a homebuilder and covers other issues like blueprints and what should be included in a final work contract before you sign.

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