KIRKLAND, Wash. - Police say a Kirkland-based home builder and re-modeler used his community connections to allegedly dupe more than 35 families out of millions of dollars, and counting.
The case against the builder is growing as more victims come forward and various agencies in King County compare notes. The FBI may be called in.
The builder was arrested Sunday by Kirkland police for what appears to be a Ponzi scheme. He is not being named as charges have not been filed.
Robert Dugoni says he and his wife are among the victims. And he says the Kirkland builder’s schemes are in the midst of unraveling.
“My wife has been friends with the builder for more than 50 years,” Dugoni said. “Their grandparents were friends. She’s known him a very long time and because of that relationship we had a great deal of trust in him. He had gone through a difficult period in his life. His wife was ill and so when we decided to add on to our house, I said to my wife, ‘Why don’t we use him?’ And, she agreed.”
“Nobody knows (why he did what he did),” he said. “… I can only speak to my circumstance and I can tell you that the statements he made to me and my wife were not true and the documents he provided to us were forged, were fraud. Those are intentional acts. But I can’t tell you what his motivations is, why he did it, when he started, I have no idea.”
All anyone knows now is from a June 3 email to customers:
We deeply regret to inform you, that due to unforeseen business difficulties, we are not able to fulfill our obligations. We are forced to close the … business. Our intent is to liquidate the business through a court supervised receivership. You will receive a notice of the filing from the receiver with instructions on how to proceed. We truly apologize for any hardships to you.
From friend, to builder, to allegations
When Dugoni and his wife wanted to add onto their home, they opted to work with the builder — his wife’s friend of more than 50 years.
“He needed $75,000 up front,” he said. “It was because there were tariff’s going in with respect to drywall, lumber and a whole bunch of things because of the politics going on in Washington and we had the ability to lock in both the materials and sub-contractors to get to work immediately on our job and keep the prices at a certain level.”
They agreed to pay the deposit under the condition they could have copies of invoices from the sub-contractors.
“He provided us invoices from the sub-contractors showing that they had been paid,” Dugoni said. ” Again, nothing happened, for months. At that point, I wanted to fire him, but because of his relationship with my wife we simply decided to go forward.”
Dugoni’s wife had also recommended the builder to her best friend last year, Laura Capestany. The builder was quick to respond to her call.
“So he immediately comes out and looks at the property, brings another gentleman with him and says, ‘Yep, we can get the ball rolling, I’m gonna need a deposit of $25,000.'”
Capestany became suspicious when out of the gate he overcharged her credit card by more than $2,000. But she says the builder was very reassuring and talked about his long history with her best friend. She can still recall what the builder said: “I know this family forever, they trust me with their own project. You don’t need to worry, it’s going to get done.”
And he promised to get started on her project right away. Eventually, Capestany was ready to get the project going. But the builder was unreachable.
“And he didn’t answer,” Capestany said. “I thought, ‘Okay, that’s kind of weird.’ And then I called him and I texted him on Monday, then Tuesday and I was like, ‘Hmm, I know he had a father that was sick.’ So I thought, ‘Well, maybe his father’s sick again in the hospital.’ You know I’ll give him a little bit of time.’ But then I call (my friend) and said, ‘Hey, what’s going on with this guy?'”
Dugoni’s wife did some checking. The news wasn’t good.
“(She) calls me immediately back and says, ‘Oh my gosh, Laura, I just heard a rumor he’s going to declare bankruptcy. I can’t believe this. I’m going to go right now to his house.’ Because she knows the family.”
Mr. Dugoni remembers when his wife confronted the builder.
“He told my wife that the sub-contractor invoices — he had forged,” he said. “That none of the sub-contractors had actually been to our house or bid the job or been paid the money that we had given him. He told my wife that there was in excess of dozens of families and $2 million in debt that were gone.”
The builder was arrested on Sunday in Kirkland, days after Dugoni confronted him. He was arrested on a fraud charge after Kirkland police visited a job site and found probable cause. After being booked and an interview with police, he was released on his own recognizance.
Sgt. Rob Saloum says news of that arrest spread like wildfire. More victims have come forward in less than a week.
“This was the catalyst. So, based on that, we did start getting calls, other jurisdictions started getting calls,” Saloum said. “King County (Sheriff’s Office) started getting calls and it’s kind of ballooned up since then as a result of that.”
Sgt. Ryan Abbott with the King County Sheriff’s Office says a deputy dug a little deeper into the case and a pattern began to emerge under the builder’s name. Cases that were filed as a civil matter could in fact be criminal.
“Forged work orders, forged other documents in relation to work that the suspect was claiming he was getting done that he wasn’t getting done,” Abbott said. “So there was a lot of extra work put into it from the detective side as well, and after talking to the victims, realizing we’ve got a big problem wit this guy and we need to figure out exactly what’s going on.”
The sheriff’s office is taking the lead on the investigation because a majority of the cases are in its jurisdiction. Abbott says there are around 35-40 victims so far.
“But it’s going to go higher than it was,” he said. “Yesterday, (the detective) told me it was $5 million, well over $5 million, close to $6 million. I’m going to guess the number is higher at this point, but we don’t have those exact numbers yet.”
Next week, lead detectives for each agency will discuss all the cases surrounding this one builder. The FBI could be called in.
A shocked community
Dugoni says he is shocked by the builder’s scheming and deception.
“He’s very charismatic, he’s very bright, he’s very personable and he’s been in the community for 58 years or however old he is,” Dugoni said. “Frankly, the bottom line is we trusted him because we knew him. And I think many families will tell you the same thing.”
“It’s horrible,” he said. “There are families out there that have lost 401K’s, they have lost $500,000, $600,000, $250,000. There are families in which construction was started and then stopped and now they have sub-contractors placing liens on their homes. They have sub-contractors coming to their homes and taking back materials that were never paid for. The amount of damage and pain that has been caused to numbers of families, not only in Kirkland, but in surrounding communities is really unbelievable.”
Designer Thomas Miller says he is sickened that he was unwittingly duped into the builder’s scheme. The builder owes him thousands in unpaid plans drawn for clients. But Miller says he feels horrible for the victims.
“Internally, I feel almost dirty or you know when you find out you’ve been part of a racket or a scheme you weren’t even aware of,” Miller said. “It’s going to take a while to get over that.”