Their Instagram Looked Incredible. They Are Going to Prison.

A couple here in North Texas just got federal prison time for taking $4.2 million from more than forty families across six counties and leaving custom homes unfinished. What got me is that this is the second couple in our area in a few months, and I do not think either of them started out as a con artist. They got in over their head. The line from the court records tells you exactly how it happened: they commingled every client's installment payments in one operating account and used one family's deposit to pay the subcontractors on somebody else's job. Jonathan has seen the books behind that pattern more times than he can count, and he walks through what should have been there instead. Job costing. A written draw schedule the client sees up front. A separate bank account for every project, which Texas law already expects of you. If you are not a contractor, the takeaway still lands, because their social media looked incredible the entire time.One correction from the recording: we said six and a half years each. It is six and a half years for him and one month for her, plus three years of supervised release, and the judge staggered them so their four children are not without both parents at the same time. The $4.2 million, the forty plus victims, the six counties and the $2.8 million in restitution are all correct.Book a Free Call with PennyConnect with us:FacebookInstagramLinkedIn1610 Financial SolutionsTakeaways:Taking a deposit from one client to pay for another client's job is the mechanism behind almost every contractor fraud case, and it starts long before anyone decides to steal.Texas already requires contractors to account for each project's funds separately, and almost no general contractor's books actually do it.A job costing tool, a written draw schedule and a separate bank account per project turn that risk into a system you can show anyone.A bid that comes in dramatically under everyone else's is a warning, not a bargain.What a business posts on social media tells you nothing about whether it can pay its subcontractors.This show is for general information and encouragement. It is not tax, financial or legal advice. Please consult a professional about your particular situation before you make any decisions.