"You had a web of permit fraud and deception," said San Francisco City Attorney's Office Spokesperson John Cote.
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The allegation, that the engineering firm obtained permits for things like bathroom and kitchen remodels when in actuality they were excavating to add new floors and spaces below the existing structure according to a lawsuit filed by City Attorney Dennis Herrera.
"The fraud was perpetrated to get a competitive advantage," said Cote.
The spokesperson for the San Francisco City Attorney's Office says Principal Engineer Rodrigo Santos, a former President of the Building Inspection Commission, used his expertise and understanding to game the system by saving on costs and increasing speed.
Santos says he's being falsely accused.
"We're structural engineers we do drawings we obtain permits we don't control who gets to implement that work," said Santos.
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The contractor for 601A Fell Street is also named in the lawsuit.
"You push the job to get it done within the contract period as fast as possible," said Andy Moussouras.
"Are you saying you started excavating before you had an excavation permit," asked ABC7 News.
"Um, that is correct," said Moussouras.
When ABC7 News asked if Moussouras knew that was illegal he said, "I know and sometimes you go through a red light that's illegal too so you deal with it right."
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"Dig first and ask for permission later doesn't cut it in San Francisco," said Cote.
The City Attorney's Office also says the excavations put people in adjacent properties at Marietta Drive and Roosevelt Street in danger.
"If there was any damage caused by an excavation we will make sure that they are made whole," said Santos.
Neighbors at those adjacent properties either weren't home today or didn't want to speak on camera.
The penalties the City Attorney is seeking across the three properties could total in the millions.