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SF sues former building inspection chief, alleging fraud

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San Francisco City Attorney Dennis Herrera is suing a construction company and several of its contractors and clients, accusing them of an elaborate scheme involving permit fraud.

According to the civil suit filed in San Francisco Superior Court Thursday, construction company Santos and Urrutia Associates Inc. and some of its clients allegedly forged documents, lied and misrepresented plans to city agencies, and used unlicensed contractors for projects that involved adding lower floors homes.

The lower floors were added by digging below existing foundation, the type of projects that Herrera says require extensive regulatory oversight to ensure safety.

Herrera said in a statement:

“This is earthquake country. … We have building codes for a reason. At the top of that list is preventing a collapse that kills someone. That’s especially true when you’re talking about hillside construction in a residential neighborhood.”

Herrera said the scheme involved the defendants obtaining quick building permits by misrepresenting the construction work as kitchen and bathroom remodeling jobs. The unpermitted digging also put in jeopardy the safety of construction workers and neighbors, who were not notified of the digging, Herrera said:

“These defendants showed a total disregard for state and local laws designed to protect people. They were indifferent to the homes and lives they put in jeopardy.”

In addition to Santos and Urrutia Associates Inc., the suit also names the company’s chief executive officer Albert Urrutia and its chief financial officer Rodrigo Santos as defendants. Both are licensed engineers.

Santos is the former president of the San Francisco Building Inspection Commission, the city agency responsible for enforcing building codes. He is also a former trustee with the City College of San Francisco Board of Trustees and has served on The City’s Workforce Investments Board.

Herrera said:

“It’s sickening that a former head of the city commission responsible for building safety is allegedly involved. The fraudulent techniques these defendants used were meant to subvert the integrity of the special inspection system that keeps the public safe. It’s outrageous,”.

Santos and Urrutia are accused of using their decades of experience and familiarity with The City’s Department of Building Inspection and Planning Department to trick the permit system and bypass regulation and oversight.

The suit also names contractors used for the unlawful work and homeowners at three different San Francisco properties accused of being in on the scheme.

According to Herrera’s office, after the building inspection department caught and cited the defendants, they then filed permit applications for the correct permits, but again falsified information and continued to work beyond the scope of their permits, violating numerous stop-work orders by The City.

According to court documents, the construction work in question occurred between 2016 and this year.

The suit is seeking a court order to repair the properties so they’re not in violation of any laws. Additionally, it seeks monetary penalties of up to $500 per day for each building code violation, up to $1,000 per day of each planning code violation and up to $2,500 for each unfair business practice violation.

The penalties between the three properties could add up to millions of dollars, Herrera’s office said.

Representatives from Santos and Urrutia Associates Inc. were not immediately available for comment.

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