SalemNews.com, Salem, MA

Local News

March 22, 2014

Judge sets high bail for unlicensed contractor

Court views video of chimney being knocked down

SALEM — After persuading a judge to lower his bail in a contractor fraud case last fall, James McCarthy got out of jail — and right back to work, prosecutors say.

But bad publicity after his arrest in Haverhill led McCarthy to adopt a series of aliases — the names of other home improvement contractors who, unlike McCarthy, actually held the required licenses, prosecutors said.

In December, McCarthy, 53, of Boxford, accepted a job working as a subcontractor for Plum Island Construction, agreeing to demolish a cottage on Plum Island, prosecutors said.

But he didn’t use his own name, claiming to be “Jeff Schwartz,” the owner of a company called “Pegasus Construction,” according to prosecutors. He used a forged insurance binder, purportedly signed by an insurance agent who had died months earlier, prosecutors said.

And he had no license to operate the excavator he used to demolish the house, said prosecutor Phil Mallard.

During a hearing yesterday, Mallard asked Judge John Lu, who last fall had agreed to reduce McCarthy’s bail from $10,000 to $7,500, to set it at $1 million, pointing to that incident and a string of others, including ones in Salem and Wenham.

To make his point, Mallard showed the judge a video taken at the demolition scene last December by two suppliers for the project.

And while it is comical in parts, as the unlicensed McCarthy backs up and down a mountain of debris and then eventually succeeds in knocking down the house — and a neighbor’s chimney — the outcome could have been deadly.

That’s because, Mallard said, McCarthy then hired unskilled workers to replace the neighbor’s chimney. In the process, they installed a chimney cap over the flues for the home’s heating and hot water systems. That, Mallard suggested, could have led to tragedy had the general contractor not noticed.

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