How contractors using a fake Philly address endangered workers and dodged accountability

”Crumbling City” is an Inquirer series about construction safety and oversight in Philadelphia.

Based on the document trail leading to its doorstep, 7710 Castor Ave. in Northeast Philadelphia should be a hive of corporate activity — the past or current headquarters of at least 25 companies doing framing, roofing, foundations or other construction work in Pennsylvania and New Jersey.

Yet, on a recent weekday afternoon, the doors were locked and no one answered at the modest storefront, which houses a school called the Philadelphia English Language Institute and features a small poster with a Brazilian flag advertising a notary service. All that’s visible of these company headquarters is a bank of mailboxes along a wall of the tidy waiting room.

Many of those companies are short-lived — and none are, or ever were, actually located at the address.

The existence of some of the companies comes to light only when disaster strikes — in a trail of lawsuits alleging defective construction, stolen money, and work that damaged or destroyed neighboring homes, and in grim Occupational Safety and Health Administration reports of workers being endangered, harmed, or even killed.

Despite amassing hundreds of thousands of dollars in fines and dozens of civil lawsuits, the companies using the Castor address have largely been able to evade actual accountability by changing their names and moving on, an Inquirer investigation has found.

These fly-by-night companies often operate without licenses or permits, and therefore without oversight. But a review of public records revealed that some were licensed with the state Attorney General or the Philadelphia Department of Licenses and Inspections.

In many cases, these companies were found working on the projects of much larger, licensed companies — part of an epidemic of illegal subcontracting that the city and developers have struggled to curb.

That so much mayhem could be linked to one small storefront is not entirely surprising, said Philadelphia Controller Christy Brady, who recently announced plans to audit L&I’s building oversight in response to the Inquirer’s “Crumbling City” series.

» READ MORE: Philly controller said she will audit L&I over construction safety after Inquirer investigation

She’s hoping to untangle the connections between unlicensed contractors, L&I enforcement, and a rash of construction damage across the city. “With people getting injured, people getting killed, we can’t wait for the next tragedy to happen,” she said in an interview. “And with undocumented and unlicensed workers, you have the cost of misclassification to the city, too, whether it’s lost tax revenue or other costs, which would be risks to workers and residents from unscrupulous contractors cutting corners.”

Using a fake address enabled the owners in some cases to dodge accountability.

In 2017, after a Brazilian citizen named Ceitan Vespasiano fell 62 feet and died of head trauma on an Old City Philadelphia job site, OSHA opened an investigation into U.S. Construction and two subcontractors, including American Diamond Builders of 7710 Castor Ave.

The OSHA investigation file, obtained through the Freedom of Information Act, noted that the owner or foreman of American Diamond, identified as Josimar Rodrigues de Moura, had dodged phone calls, given a false address, and refused to provide the names of workers. The federal workplace safety agency warned that it would be referring the $143,159 fine to debt collection because a bill previously sent to 7710 Castor Ave. had gone unpaid.

In 2018, American Diamond was involved in a different accident — in which a temporary ladder collapsed, sending a worker tumbling multiple floors into the basement, causing broken bones, concussion, and other injuries. American Diamond’s lawyer, retained by its insurer, said he had tried and failed to contact his own client: the company. He did not know the owner’s name, which was not required for its incorporation in Pennsylvania. Nor was it listed on American Diamond’s contractor license.

The lawyer filed documents in court seeking to withdraw from the case, and recounting that he had hired an investigator who visited 7710 Castor Ave. There, the investigators report said, he was “unable to locate anybody associated with American Diamond. … The actual business residents (Language Learning Center and Boost Mobile) were unable to provide additional information.”

Arian Pereira, co-owner of the private for-profit language school, said it had offered mailbox services since before he bought it in 2007. He wasn’t sure how many construction companies used the service. He said he was aware that some fraudulently claimed it as their actual business address rather than just one in a bank of mailboxes.

“We’ve had that problem for a while now,” he said. “Every once in a while maybe there is an investigator who shows up. There are people who didn’t even rent a P.O. box with us who are sending mail there anyway. That’s part of our daily activity is getting all this junk mail and then returning it. It’s quite bothersome, actually.”

Another company previously registered to 7710 Castor, Real Construction, seemed to be more reliable, according to developer Ori Feibush, who said his company OCF Realty used Real to install about 40 foundations in the city.

Then he hired the company for a project in Margate, N.J.

“They took on a project without an awareness of the work that needed to be completed, and none of the work was salvageable. It all had to be scrapped,” he said. “It cost me a lot of money.”

Neither Real nor a lawyer representing the company responded to a request for comment.

For Feibush, it’s an example of the vulnerabilities of an industry that runs on the use of subcontractors — who, once they get the job, are expected to work without constant oversight.

“The exhaustive frustration is that subcontractors, expressly, against contracts and verbal warnings, go out and sub out their work because they’re oversubscribed. The subcontractor we vet may be capable, but if they go and sub out work to another firm then all bets are off.”

That’s what happened two years ago when a worker who was not wearing any fall-protection gear fell 45 feet and died at an OCF Realty job site at 24th and Sansom Streets. That man, Siarhei Marhunou, was a recent immigrant from Belarus and the father of a 3-month-old child. He was working as an independent contractor for a small siding company, DPSY, which was a subcontractor of Hammers Construction, which worked under Fitler Construction, which was OCF Realty’s construction manager.

Feibush said he fires contractors he discovers subbing out work, but it’s challenging to police job sites. Feibush said his contractors told him that Marhunou died on his first morning on the job, within an hour of starting.

However, according to an OSHA investigation report obtained by The Inquirer, DPSY owner Pavel Dubinka said Marhunou had been working on the OCF Realty project for a month and a half, completing work at five different units there. Dubinka told OSHA he wasn’t sure who was in charge of safety at the site.

“I don’t know how to keep subcontractors from subbing out work,” Feibush said. “That’s where accidents happen more often than not.”

Pennsylvania’s Home Improvement Consumer Protection Act requires contractors to provide a real address, not just a post office box, on all contracts.

But a look through the state Attorney General’s licensed contractor database shows that using virtual offices, mail-forwarding companies, and post-office boxes remains a common and open practice among many small contractors operating as limited liability companies.

Michael Bergen, who worked in construction before spending four years at L&I as a construction plans review specialist, said the Castor Avenue address was well known.

“All the LLCs use them as a drop so they have a legit address within city boundaries — but they don’t have anyone there who knows anything,” he said. “They’re often in a situation where they’re doing things and have no fundamental understanding of what the hell they’re doing. It’s scary.”

One contractor whose companies were listed at 7710 Castor Ave., Murillo da Costa Sousa, left a trail of chaos, according to court filings — including a pending consumer fraud lawsuit by the state Attorney General.

Sousa referred questions to his lawyer, Steven Carroll, who declined to discuss the case in detail, but said, “We deny the allegations and we plan on contesting them.”

In 2016, Sousa was working under LMN General Construction, according to a lawsuit by a South Philadelphia couple who said their home was nearly destroyed when he undertook a renovation next door.

There, workers obtained a permit for minor interior demolition — then, according to the court filing, not only illegally gutted the building but dismantled the structural shared wall. The couple said they urged workers to stop as their home shifted, walls cracked, water leaked in, and finally a board punched through the drywall into their bathroom — revealing that their insulation and exterior wall had been removed. Later, they said, they learned that the work introduced wood-eating powder-post beetles into their home.

But when L&I issued stop-work orders, Sousa’s crew shifted to nights and weekends. The developer settled the lawsuit out of court. Sousa’s company, LMN General Construction, never responded to the case.

By 2021, Sousa was working under a different name, Max Contractors, when his company drew attention from OSHA after a staircase collapsed under a worker who ruptured his Achilles tendon.

Last year, OSHA fined Max Contractors $269,000 for exposing workers to hazards at numerous job sites.

“Max Contractors’ repeated and blatant disregard for its employees’ safety and well-being will not be tolerated,” Philadelphia OSHA Area Director Theresa Downs said in a statement. “Falls can cause serious, potentially debilitating injuries and death.”

Max Contractor’s OSHA file shows the penalties had gone unpaid and were being sent to debt collection.

Meanwhile, Sousa toggled among at least seven different business addresses, and as many corporate identities to attract new clients, according to court filings.

One of those clients, Lindsay Hymson, hired his company, Clean Future General Construction, after she took out a $100,000 loan to gut renovate a South Philadelphia rowhouse.

She said her then-boyfriend found Sousa through Thumbtack in 2018, in a moment when they were desperate to get work started so they could renovate their South Philadelphia rowhouse and move in.

Hymson was living in New York at the time, and said her ex approved all of the payments to Sousa even though work was still in progress. Then, about March 2019, she said, “Murillo stopped contacting us.” When she got to the house, she discovered that the stucco was crumbling, windows weren’t working, the HVAC system was devoid of vents or returns, and the gas line was running up a chimney that was completely capped.

“If we were to rent it out or live there ourselves, we would have gotten carbon monoxide poisoning and died,” said Hymson, who said she ended up spending $26,000 more to finish renovating the house so she could sell it. “I was afraid to live there, knowing that he was the one that did the renovation.”

She took Sousa to arbitration and was awarded a $113,524 judgment in March 2020 — but court records show that three years later she still has not been able to collect that money.

Carroll, the lawyer, said he was not familiar with the case and could not comment on it.

Hymson began researching Sousa, and soon connected online with about a dozen other people who told her he scammed them or left projects unfinished, she said.

“There’s records online going back to 2014 of people complaining about him. He changes his LLC and his bank account process every single time he gets caught.”

Sousa pleaded guilty to theft by deception in February in Delaware County and was given probation. A similar case in Philadelphia was dropped after he agreed to pay restitution.

In April, the state Attorney General finally sued Sousa, seeking restitution and a permanent ban on Sousa working as a home improvement contractor in Pennsylvania. The lawsuit accuses him of fraudulent business practices, including taking tens of thousands of dollars from clients for work that was never completed, and doing shoddy work that, in one case, caused structural defects and “left the house in [imminent] danger of collapsing.”

In addition to the death and serious injuries reported at Max Contractor’s and American Diamond’s projects, OSHA has issued violation notices to at least eight more companies that have used the Castor Avenue address.

In addition, workers alleged in lawsuits that six other construction companies that have been based there caused them serious injury.

Construction is among the most dangerous industries in America, with more than 1,000 on-the-job fatalities last year, according to the U.S. Bureau of Labor Statistics. Foreign-born Hispanic and Latino workers accounted for almost one-third of those deaths.

Those workers face elevated risks from the layers of subcontracting, an ever-shifting, temporary workforce, and some of the most dangerous job assignments, according to Luz S. Marin, an associate professor of safety sciences at Indiana University of Pennsylvania. Her research has included how to promote safety for Hispanic workers in the construction industry.

“There are many limitations for small companies: They’re less likely to have a person who knows more about safety. The availability of training or other resources like protective equipment is limited. They are more likely to hire people that are undocumented or with less experience. So there are overlapping vulnerabilities.”

Wilfred Barahona, 37, the now-disabled roofer and Guatemalan national who sued Business Experts Inc., described in his lawsuit a job site where no one was responsible. The company that held the contract, Castillo Construction, was actually a marketing company that employed no roofers, according to his lawsuit. Castillo then subcontracted to Oziel Construction which subcontracted to Business Experts. Castillo did not return phone calls; attempts to reach the other companies were unsuccessful.

There was no safety equipment on the site, no fall-arrest system, no scaffolding or even ladders provided, Barahona alleged in his lawsuit. Workers “were forced to create a makeshift ramp, fashioned out of plywood sheets, to transport roofing materials.”

His lawyer, Evan Padilla, said such arrangements are typical in cases in which horrific worker injuries occur.

Two of the subcontractors named in the case, Business Experts and Oziel, never responded to the lawsuit.

In cases such as these, Padilla said, “I don’t even know if it’s a real company. That’s how they operate. If they need guys to do a specific job, they call the state to create a company and they use that to apply for insurance, and lie to the insurance company about what work they’re doing. They pay the first month’s premium and then, a lot of times by the time the accident happens, the insurance has already lapsed.” In his view, it’s part of the corner-cutting culture of residential construction in Philadelphia.

But many of the deaths and serious injuries, though involving workers for small companies, were on job sites run by some of the city’s largest construction companies.

In Marin’s view, general contractors set the safety standards for subcontractors, and sub-subcontractors. So, they are the ones who need to take responsibility for the safety of all workers on their job sites, building communication of safety precautions into daily meetings and creating joint safety committees to ensure that all subcontractors are aligned.

“This is an idea that has been implemented in other countries,” she said. “You should come to the workplace with the vision that everyone should implement the best practices and have the idea that you can work in a safe environment, and reinforce that with leadership, clear rules, clear disciplinary measurements.”

After two sisters, Susan and Mary Kulakowski, purchased newly constructed adjoining houses in South Philadelphia in 2019 that turned out to be riddled with defects — requiring the replacement of roofs, facades, windows, electrical wiring, plumbing and more — they sued the builder, ATL Development Group.

But what they didn’t know, until the lawsuit progressed, was who actually built their homes.

» READ MORE: How Philly's building inspection system is failing homebuyers

It turned out that ATL had contracted United Construction Group, which had, in turn, subcontracted the work out to 10 different companies. That included a plumber and an electrician whose names appeared nowhere on the permits (nor in the city’s directory of licensed tradespersons).

Also on the list was American Diamond Builders, the seemingly phantom company that OSHA had repeatedly cited for worker injuries and the death of a man in 2017.

As before, American Diamond defaulted on the lawsuit, which ATL and the Kulakowskis settled out of court this year. Attempts to reach ATL owner Ayahan Atalay were not successful.

The sisters are among at least a dozen people who sued companies linked to 7710 Castor Ave. over shoddy or unfinished construction. There was a family whose home came with “unending problems”; a developer who said subcontractors never did work they were paid for; and five separate homebuyers, including an Inquirer photographer, who sued WRTS and other companies over homes in a luxury Fishtown housing development that were beset by leaks and mold.

» READ MORE: How water intrusion in new homes turns American dreams to rot

Five other plaintiffs said companies that had been linked to the address had undermined adjacent homes, destroyed roofs or cracked foundations.

Construction lawyer Jennifer Horn said many companies marketed as homebuilders are actually pass-throughs for contracts. The problem, in her view, is that if those builders don’t know what they are doing, and city oversight is lacking, there’s nothing to ensure that a home is constructed properly.

“In my experience, the repercussion for homeowners is often quite severe, and there is no way at the onset for the homebuyers to even understand what, if any, vetting of the subcontractors has happened,” she said. “They really don’t know what is lurking behind the walls.”