Nine contractors arrested on charge of illegally bidding on reconstruction projects in Camp Fire disaster zone

PARADISE, Calif. (KGO) -- As spring draws near, many of us plan home improvement projects. And law enforcement is warning to watch out for unlicensed contractors. The Contractors State License Board joined police in a sting in the burned-out town of Paradise. Nine suspects were arrested for bidding without a license.

The Contractors State License Board, or CSLB, has been warning homeowners in the wildfire zones and everywhere: do your research before hiring a contractor or handing over cash. They've also warned the unlicensed contractors - there will be sting operations. Which is why some weren't surprised when they got arrested.

A video by the CSLB shows a sting about to happen.

"Is there a jog somewhere or does it go straight down? When did you guys wanna get started?" asks a contractor on the video.

"We should wind up about next week," says a law enforcement agent.

The man with the tape measure offers to build a fence at this burned-out property in Paradise. He thinks the other man is the property owner.

Really he's an undercover agent.

The man says it'll cost $5,500 for the fence. Any job over $500 requires a license. Authorities say he doesn't have one. The man also asks for half the money up front -- also illegal.

Contractors can't charge more than 10 percent down or $1,000, whichever is less, for most jobs.

"Do you want to pay cash?" asks the contractor.

At that point, police come out of the brush. "Hi, how you doing... This is uh, a Contractors State Licensing Board, uh, sting, ok? Do you have any weapons on you at all, sir?"

Later, another contractor bids on the fencing job. He didn't seem surprised when police arrested him

Now another contractor tries bidding by the hour -- instead of by the job. "If I charge you a contract price I could get my (expletive) in a jam you know, so I'm gonna work by the hour... So you're looking 16, two grand right in that area..."

He was surprised when officers arrested him. "I don't know why you'd be doing this to me, I haven't done anything."

Hourly or not, a large job requires a license.

"When you hire somebody who's not licensed, they may talk a good talk about how much experience they have and how much work they've done, but you've got no idea they have any experience doing this kind of work," said Rick Lopes, CSLB spokesman.

Lopes says it's a risk to hire an unlicensed contractor. "Chances are you've only got a phone number... and if you do have a problem, it's almost impossible to track them down."

Whether you're in a fire zone or not, it's best to check the CSLB website before you hire a contractor. It'll tell you if the person is licensed in good standing, and insured. It also has a list of qualified contractors near you. And most important, never pay more than 10 percent down or $1,000, whichever is less.

More 7 On Your Side tips for working with contractors:

• Don't pay a contractor in cash.
• You should only pay a contractor as work is progressing. Don't pay the full amount until the job is done.
• Check online for a contractor's reviews, ask neighbors for recommendations.
• Ask the contractor for at least three local references.
• Get a commitment in writing for when the work will start, and when it will end.
• Generally, by law, contractors can't charge you more than 10 percent down or $1,000, whichever is less. However a few large companies like Home Depot have a special bond protecting customers so they can charge you as up to the entire contract amount up front.

Take a look at more stories and videos by Michael Finney and 7 On Your Side.