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‘Bait and switch’ movers shut down

Photo Credit: Cliffview Pilot
Photo Credit: Cliffview Pilot
Photo Credit: Cliffview Pilot
Photo Credit: Cliffview Pilot

BEHIND THE STORY: A judge shut down the businesses of Russian movers who called themselves “Greg,” “Kyle” and “Sam” after state authorities charged them with holding customers’ belongings hostage until they paid hundreds or thousands of dollars more above the original bill.

In one case, an employee demanded sex in exchange for reducing the suddenly ballooned price, state authorities allege.

“I have never seen the Mafia other than in movies,” one customer said, “but this seems close.”

“The State has no tolerance for unscrupulous movers who hold consumers’ property hostage as a form of extortion,” state Attorney General Jeffrey S. Chiesa said this morning. “We are committed to cleaning up the marketplace to ensure a fair and safe environment for anyone seeking to hire a mover – and to protect the interests of the many movers who operate honestly and in compliance with the law.”

Paterson-based Progressive Movers, Inc. and its principal owner were already under a consent order with the state following previous complaints when Chiesa and the New Jersey Division of Consumer Affairs obtained the court order against them, Lodi-based ABC Packing Services, Inc., and their principals on Tuesday.

The judge’s order requires them to return customers’ property without requiring any payment. It also voids any contracts the defendants had to do any future moves or storage and prohibits them from selling or transferring any assets related to the lawsuit.

A June 15 hearing is scheduled to determine whether they should remain shut down while a lawsuit filed by state authorities this week proceeds.

The majority of those scammed weren’t poor or ignorant. Many of them are professionals or college students — including one who was going to law school – records show.

“First, they give you a $70 per hour quotes for three movers,” one said. “They assure you over and over again that there will be no additional charges. Once they load your furniture on the truck, the scam begins… You are then presented with a bill for at least six times your original estimate.

“For what I was assured of over and over again would cost $210, I was given a bill for $1284, including many charges that I was told were included. Your furniture is held hostage until you pay the money. If you can’t pay, they will take your furniture and they say it will be put in storage until you can pay.”

Two friends said they got the same type of estimate: three movers at $70 an hour from Progressive. They said they were assured them it wouldn’t cost more than $270, with no extra costs. Seemed reasonable, they said, considering they were moving only a few blocks away.

On moving day, the women said, the crew that showed up began packing, even though they said they didn’t need the help. Once everything was loaded onto the truck, they said, they received a handwritten bill – for $1,300.

One of the most outrageous incidents reported involved a bill – also written on a scrap of paper — for $3,612.38. When he refused to pay, the customer said the company offered to “release” his mattress so he had something to sleep on, for $1,100.

One of the complaints led to arrests last fall of three Progressive employees, all from Saddle Brook, after an elderly Salem County woman summoned police, saying she’d been scammed.

The woman told police she signed a contract for $210, then was hit with a bill for $1,755 after everything was loaded onto the truck. She came up with $750, including $50 in quarters that she used for laundry, and, in turn, got a recliner, a bed frame and nothing else back.

While the men were being questioned, a police dog reacted to something in the cab of the truck. Police said they found marijuana, then arrested all three movers.

Police otherwise can’t really help, because the overbilling disputes are civil matters. But the DCA can.

In their lawsuit, state authorities say the movers hatched a scheme in which they posted profiles for Progressive and a company called Modern One on websites where consumers search for local movers. The profiles had no phone numbers but, instead, required customers to seek estimates online that turned out to be as low as $210 a move.

Customers received confirmations saying the quoted price included services such as loading, delivery, re-assembly, truck rental, gas, and insurance – even five free packing boxes.

The movers required customers to sign blank, incomplete documents, such as bills of lading, or packing charges forms, without letting them read the forms. They then filled in the blanks with “exorbitant, unexpected charges,” the DCA said.

In many cases, the extra charges covered services which were unjustifiable or unwarranted, or which weren’t explained ahead of time to the consumers, state authorities allege.

Next thing people knew, their price had been jacked up to anywhere from $500 to $4,940, they said.

The average total price was $1,400 – more than 500 percent above an original $210 quote, state authorities said.

The catch: The defendants often waited until the customers’ belongings were either locked up in a moving vehicle, or put in storage, before dropping the new bill.

When consumers refused to pay, the companies “told them their property would be kept in storage and not returned until the consumers paid the demanded amount, as well as storage costs,” the DCA said.

In several cases, the movers drove off with people’s property, refusing to return it for days until the consumers paid, state authorities allege. Those fortunate enough to retrieve their valuables said they often found things damaged or missing. The companies refused to cover the losses, the DCA said.

The DCA cited recent complaints from 87 customers – the most against any moving company in the state.

“The Division of Consumer Affairs received 199 complaints about moving companies last year – many of which were filed against these defendants,” said the agency’s acting director, Eric T. Kanefsky. “This action stands as a warning to predatory movers, and a reminder that consumers should learn as much as they can about a moving company, before trusting its workers with their valued property.”

Progressive Movers, Inc. advertised under a variety of names, including Modern One Versatile Expert Relocation Service, M.O.V.E.R.S. Inc., and Modern M.O.V.E.R.S. Inc, according to the state’s ten-count civil complaint, filed in Passaic County. The company is owned and operated by Konstantin Egorov, who is also a defendant in the State’s lawsuit.

Although consumers contracted with Progressive Movers, they later were charged for packing services and materials demanded under the name of a company they’d never heard of before the moves, the suit says.

That company, ABC Packing Services, Inc. of Lodi, wasn’t licensed to perform moving services in New Jersey. Its owner and operator, Yevgeniy “Eugene” Piksun, is also a defendant, along with the company.

Egorov and Piskun often used aliases when interacting with consumers, the DCA said this morning. Egorov, for instance, called themselves “Greg” or “Kyle,” while Piskun went as “Sam.”

They are also accused of giving customers documents that used the name of any actual registered business, State Wide Box Company, Inc., that has no relation to them.

State officials pointed out that Progressive Movers and Egorov already had agreed to a consent order with the DCA in July 2010 aimed are resolving previous complaints. It allowed them to stay in business, under certain limitations and requirements that state authorities say the company and Egorov ignnored.

The DCA is seeking full restitution for the affected consumers, as well as civil penalties, and repayment for the State’s investigative costs and attorneys’ fees.

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