Home Depot's Contractors Instructed to Intentionally Inflate Estimates, Charge For Items Not Installed

KNBC in Los Angeles is investigating a nationwide epidemic of fraud being perpetrated by Home Depot. Is it that bad? Yeah, it’s that bad. From KNBC:

Now, NBC4 has heard from customers in 22 states and from insiders from across the country, who have given NBC4 a paper trail of internal documents, suggesting the company overcharges customers on window and siding installations, kitchen remodels and on roofing jobs.”

KNBC brought in an expert to inspect the work Home Depot had done on one customer’s roof. He found that new flashings costing over $1,000, shown on the customer’s receipt, were never installed. According to KNBC, these aren’t simple mistakes, they’re systematic and intentional.

“I’ve been taught and trained to rip-off customers,” says a former employee for US Home Systems, a nationwide subcontractor that sells refacing jobs for Home Depot. NBC4 spoke with numerous employees of the company.
“You were told to intentionally inflate the estimate,” Grover asked the former employees.

“Correct,” they replied.

If a job came in on budget, the customer was supposed to receive money back. But the insiders showed NBC4 documents proving some customers didn’t get money back.

“How often did customers not get back money they were owed,” Grover asked the insiders.

“A hundred percent of the time,” one insider replied.

“Are you saying thousands of people have been ripped off,” Grover asked.

“Yes,” the insiders replied.

The good news is: Home Depot is offering to make good with ANY customer who contacts them through KNBC. Nationwide. If Home Depot’s contractors have ripped you off, click here to contact KNBC!

Home Depot Investigation – Part 3 [KNBC]
(Photo: MortonFox)

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  1. rekoil says:

    Last year I called Home Depot, among other contractors, to estimate a reroof job for my townhome complex. HD’s bid came in more than double the next highest, thanks to a claim that in addition to replacing the roof, they would need to replace the soffiting (the ventilated decking underneath the lower edge of the roof) in order for the shingle manufacturer to warranty the materials. Every other contractor who made a bid said our soffiting was fine.

  2. rekoil says:

    Oh yeah, the guy also told me “we don’t use contractors, every guy on the job will be a Home Depot employee”. One of the other contractors who bid the job then told me that HD subs jobs to him all the time. Bastards.

  3. thejbs says:

    Take a look at the video on the TV station web site.

    I think the ‘cue card’ part was amusing, although not surprising.

    If the stories are true this is a pretty huge fck-up!

  4. MeOhMy says:

    Thank god I inherited the “handyman” gene and can do most of this stuff on my own. I dread having to risk getting scammed by a contractor.

  5. bdemeter says:

    This is what we gt for having the schools drop shop class. A society who is easily dupped becuase they no longer have any idea of the value of the labor. I wouldn’t be surprised at all to learn that Home Depot and Lowes-esque stores originally petitioned the schools to drop this form of education

  6. dohtem says:

    The good news is: Home Depot is offering to make good with ANY customer who contacts them through KNBC. Nationwide. If Home Depot’s contractors have ripped you off,

    Now we just have to tell the entire country about it. Not just the greater Los Angeles area.

  7. Nemesis_Enforcer says:

    LoL I live in LA and we just redid our Kitchen. Just for kicks I got a estimate from HD. Double what the other Contractors wanted and when we took thier estimate of supplies to the store everything was marked up by at least 50% over what the actual retail cost was. Pretty hefty profit without even touching the job yet.. And of course we did it ourselved for about a 1/10th of what the lowest contractor quoted us.

  8. adamondi says:

    @Troy F.: I don’t think it is all that necessary to inherit any sort of handyman gene, Troy F. There is a lot of this stuff that can easily be taught. Go find your local ACE Hardware (or something similar that is small and has people who actually know what they are talking about) and get the advice of someone who knows exactly what he or she is talking about. There is an ACE Hardware franchise location that is owned by a local guy close to my home. I have gone there for several things and gotten perfect advice and instructions on how to do things, even after the guys at Home Depot were totally befuddled by my questions.

  9. Terminixsux says:

    Or, simply get references from friends, aquaintences, co-workers or anyone else you trust. This is the best way to get a good contractor. Not everyone has the skills and temperment to be a do-it-yourselfer. And I for one don’t want to spend my time that way.I’d rather pay someone skilled to do it and spend my free time doing things I enjoy. I realize many people obtain enjoyment from DIY, but for me, it often just ends in frustration.

  10. Coder4Life says:


    wow, that is pretty shady. I am sure home depot had nothing to with this..NOTTTT.

    Stupid coopreratings that think they can do anything.

  11. royal72 says:

    you know if any of us went to home depot, filled a cart and payed with photocopied money, we’d go to jail. yet when any corporation repeatedly robs people, it was just a terrible misunderstanding, they’re happy to “fix” the problem, and their only punishment is self-administered in paying a little extra to the pr dept to make it go away.

  12. Maulleigh says:

    How much more money does Home Depot need? At least they’ve got a competitor in Lowes. Thank god for Lowes. Not that I give a damn but I appreciate a little competition.

  13. North of 49 says:

    Mike Holmes is a spokesman for Home Depot in Canada. Holmes on Homes is a show that regularily rips people about shady contractors like those. I think he’d be ashamed to stay with Home Depot if he heard about it.

  14. bobsmith says:

    Yeah, this is old news. It has been well-known for some time that Home Depot is a sleazy outfit. I went into my local HD a few weeks back and I think I was the only one there! It was like a ghost town.

    We to HD a couple years ago for an estimate on a ceramic tile kitchen floor. They said they would charge $75 PER APPLIANCE (!!!) to slide the stove, refrigerator, and dishwasher to the next room (about 15 feet). But we would have to hire our own contractor to actually disconnect and reconnect the appliances – they couldn’t do that! I laughed in his face, told him he had wasted my time, and left.

    I got a local guy to do it. He charged about one third the price for better tile, and when I asked him if he would disconnect/move/reconnect the appliances, he looked at me like I was nuts. Of course he would!

    Home Depot was destroyed by Robert Nardelli, the crook who was hired to run it after the original owners sold it. He’s a typical Dick Cheney type of corporate scumbag.

  15. sales.se says:

    I had Home Depot come and give an estamate on
    vinyl siding. The salesman was very polite and
    seemed to know his product. Then came the
    price!!! $28,500 for the select and $26,000 for
    there basic. I was told that the select had
    styrofoam insulation in the corner cap moldings
    and a heaver vinyl. I am having an independant
    do the job with certained monogram which is a
    premium siding, with gutters for $16,295.Thats
    a savings of $12,205. We can do it! We can help
    our selves! Sears was even worse the salesman
    was obnochise and they would do it for $29,999!
    That was the special only for that day! Why
    don’t we just make it $30,000 your just too
    kind!

  16. jfosc says:

    We had some tile flooring put in our upstairs bathrooms. After the job was done I inspected the calculated square footage of the installation area (by one of the detail contractors) to the actual square footage of the floor covered in tile and discovered they used the wall dimensions of the room in their calculation.

    In essence, across two bathrooms they were charging me installation for the area that includes a single and double sink vanity, two bathtubs, and a shower.

    By the time I was done fighting with them, I ended up getting almost 50% of the installation refunded. Other factors included broken promises on scheduling, tile adhesive on the carpet, incorrect threshold, and plain ol’ incompetence.