Consumer Protection Division Orders Prince George’s County Home Builder to Pay Over $500,000 in Restitution and Penalties

BALTIMORE, MD ( August 26, 2010) - Attorney General Douglas F. Gansler announced today that his Consumer Protection Division has issued a final order requiring D.A. McDaniels t/a McDaniels Homes and its principal to pay more than $448,830 to consumers and pay penalties of $87,000. The Division found that Derek A. McDaniels and his company, D.A. McDaniels t/a McDaniels Homes, violated Maryland’s Custom Home Protection Act and New Home Deposit Act by failing to place or maintain money paid by consumers into an escrow account or having a sufficient surety bond to cover the deposits and payments made. The Division also found that McDaniels and his company violated the Home Builder Registration Act, Consumer Protection Act and New Home Warranty Act by failing to build and enroll homes in a new home warranty security plan as promised.

The Division found that McDaniels and his company collected substantial deposits and payments from at least ten families toward the construction of new homes in Prince George’s County, then failed to protect those payments as required by Maryland law, failed to begin or complete construction of the homes, and failed to pay refunds to any of the consumers. The order bars Mr. McDaniels and D.A. McDaniels t/a McDaniels Homes from acting as a home builder in the State of Maryland unless they meet requirements set by the Division in order to be registered as a home builder under Maryland’s Home Builder Registration Act, requires payment of restitution in the amount of $448,830.91, payment of civil penalties in the amount of $87,000.00, and payment of costs in the amount of $4,026.69.

“The law in Maryland is very clear: home builders must properly handle consumer deposits and they must honor their commitments to home buyers,” said Attorney General Gansler. “My office will seek severe sanctions against builders who fail to properly handle consumer deposits and who do not operate their businesses fairly and honestly.”

Home builders are required to give consumers a pamphlet prepared by the Office of Attorney General that discusses consumers’ rights under the law and steps consumers can take to protect themselves. New home buyers are encouraged to check whether their builder is registered by contacting the Division’s Home Builder Registration Unit at (410) 576-6573 or toll-free at (877) 259-4525, or by visiting the Attorney General’s website at www.oag.state.md.us/homebuilder.