Courtesy of Florence Klein, Founder, SilverPlanet.com

It’s bad enough that “Chinese drywall” was used to build homes for five years, until its terrible side effects became known. Those effects—reported by some owners of homes built between 2003 and 2008 using this drywall—have included a sulfur smell like rotten eggs; deterioration or corrosion of metal components; and health issues such as irritated eyes and skin, a persistent cough, and headaches.

But since April 2009, states have been grappling with scam companies that claim to have solutions to the problem and are taking advantage of homeowners desperate for answers.

Finally, in December, the Federal Trade Commission (FTC) issued a warning to consumers to watch out for anyone trying to sell test kits, inspections, or quick fixes for problems caused by the contaminated imported drywall. The drywall, referred to in press reports as “Chinese drywall,” has been under investigation by the Consumer Product Safety Commission (CPSC), as well as by various other government agencies, since February.

Back in April, the Florida Attorney General’s Office reported at least two types of fraudulent activity involving the defective drywall: bogus tests to determine the presence of the product and quick cure remedies that falsely claimed to remove the corrosive properties of the product.

According to reports, when the defective drywall is present in a house, a chemical process causes black corrosion to appear on copper air-conditioner coils and noninsulated copper wiring. The home builder or a qualified air-conditioner technician can conduct a visual inspection to determine if the defective drywall is present; its presence cannot be determined by “testing” the air in the home. And if the substance is found during a visual inspection, it cannot be remedied with a spray or an ozone generator. These products may make the problem worse.

Most of the complaints then were coming from Florida, Louisiana, Mississippi, Texas, and Virginia, according to Consumer Affairs. Builders there weren’t able to get enough domestic drywall to keep up with demand during the housing boom of the last decade and turned to imported drywall from China.

The following scams have been reported:

• The sale of bogus test kits: These often cost thousands of dollars and are generally ineffective. Again, a visual inspection suffices.
• Solicited home inspections by “experts” with no apparent qualifications, again costing thousands of dollars: Homeowners should beware of cold calls and door-to-door solicitors.
• The sale of sprays and applications that claim to miraculously cure the corrosion problem: Not only are these products ineffective, but the addition of moisture may accelerate the corrosion problem.
• The sale of ozone generators: Ozone will actually increase the chemical reaction between the drywall and copper, and the corrosion will be accelerated.

Problems continued into October, when the Mississippi State Board of Contractors reported that scam artists in Florida were targeting Mississippi homeowners by trying to sell them the same bogus test kits, inspections, and cures as had been done in Florida.
 
The FTC’s action follows a letter it received in mid-November from five senators hailing from states affected by the toxic drywall. They were seeking help in protecting homeowners from companies claiming to have “solutions” to the problem. The senators asked the FTC to fully investigate and prosecute companies engaging in these activities. The letter was signed by Senators Mary L. Landrieu (D-La.), Bill Nelson (D-Fla.), David Vitter (R-La.), Thad Cochran (R-Miss.), Roger Wicker (R-Miss.), and Jim Webb (D-Va.).

“Some companies have even advertised that they are part of a national certification program—despite the fact that the federal government has yet to fully determine the exact substances in this defective product,” the senators wrote.

They reported that as of late October, the CPSC had received 1,900 incident reports from 30 states, the District of Columbia, and Puerto Rico. Reported symptoms have included bloody noses, headaches, insomnia, and skin irritation. Preliminary testing has confirmed that the drywall is the problem, “but these tests have not been able to pinpoint the problem substance in the drywall,” the senators wrote.

On November 9, Landrieu introduced the Small Business Administration (SBA) Disaster Recovery and Reform Act of 2009 (S. 2731), a bill that among other things would authorize the SBA to assist to homeowners affected by the toxic drywall.

If you think you’ve been contacted by one of these scam companies, you can file a complaint online at the FTC’s Complaint Assistant or by calling (877) FTC-HELP (877-382-4357).