ELMHURST, Ill. (CBS) — A few months ago, a former employee of a roofing company contacted CBS News Chicago with a complaint.
CBS News Chicago launched an investigation and uncovered a massive operation spanning multiple states, in many cases causing homeowners to lose out on tens of thousands of dollars each. Customers said contractors from the company, Orange Elephant Roofing & Solar, simply seemed to disappear into thin air.
Kirby Reese was paid $25,725.34 in insurance money to repair the roof of her southwest suburban home after storm damage last spring. She hired Orange Elephant, a company with a website that shows they work in six cities across the country, including the Chicago area.
The Charleston and Columbia, South Carolina; Fort Worth, TX; Denver, Colo.; and Oklahoma City, Oklahoma markets also appear on the Orange Elephant website.
Where did Reese’s nearly $26,000 go?
“I guess that’s the question,” Reese said. “I have no idea.”
The reason she has no idea is because she says no work has ever been completed.
“They never even applied for the permit, so they were never going to do this construction,” Reese said.
Former Chicago Orange Elephant executives cut red flags
Former manager Stephen Cox first brought Orange Elephant’s apparent collapse to our attention. His first red flag that the company was in trouble was quite big.
“I even got kicked off a plane because their credit card was wrong,” Cox said.
Cox left Orange Elephant months ago and claims he was owed approximately $19,000.
CBS News Chicago met with Cox and Mike Schmalz, the former general manager of the Chicago Orange Elephant office, at Reese’s home.
“It was a company that grew too fast, then took on too much debt and then went under,” Schmalz said.
In May, Schmalz sent a dismissal email to Orange Elephant executives. In the email he expressed concern about his personal reputation in the roofing industry, which he said had been compromised by his association with Orange Elephant.
“Some suppliers told me that they were not paid on time. The financing was not directly through our branch, but was managed collectively,” says Schmalz, “so as general manager we were left in the dark.”
According to Cox, this appeared to be a widespread problem.
“We were told everything is getting better, you know, people were getting paid, and we found that the subcontractors across the country – like here in South Carolina – no one was getting paid,” Cox said.
Looking for Orange Elephant’s clients
Not only were contractors not paid, but homeowners never received roofs.
Cynthia Sanoguet of Chicago Heights handed over $5,000 and got nothing in return. Carolie Lenior of South Carolina gave Orange Elephant two checks, totaling more than $11,000, and also received nothing. Alexis Tecosky also lives in South Carolina and has earned almost $12,000.
Tecosky sent CBS News Chicago a video of an Orange Elephant office in South Carolina. The door was open, but no one was there. It was simply abandoned.
So CBS News Chicago went to the local Orange Elephant office, located in an office building at 925 Route 83 in Elmhurst. CBS News Chicago entered the front door and climbed the stairs, only to find file folders full of client documents left in the hallway.
There was not a soul to be seen.
Back outside, a sign on the door sent inquiries about Orange Elephant to two names and phone numbers: one belonged to Jake Kelly, the other to Natalie Ricketts. CBS News Chicago called both.
Kelly is the CEO of Orange Elephant. CBS News Chicago got Kelly’s voicemail, but he never called back.
CBS News Chicago also tried several email addresses for Kelly and even contacted attorneys representing him — with no response.
Ricketts is Orange Elephant’s director of accounting. We know this because she promised a $7,212.20 refund to South Carolina homeowner Audrey Keller.
Despite that promise in August and an estimated repayment date in October, Keller has not seen a cent.
Ricketts eventually called back and said she wasn’t part of management, but that she was “handling spreadsheets.” She said she had no idea money was being taken for jobs that weren’t done.
Ricketts said she “feels terrible” for wronged customers, but that she is “not the one responsible.”
Meanwhile, the state of Illinois revoked Orange Elephant’s business license in July this year. But the company collected a check for more than $15,000 from Evergreen Park resident James Kowalik in August.
Former Chicago Orange Elephant executives stand up for those who lost
Back at Reese’s house, work is going on, albeit not by Orange Elephant. Cox and Schmalz have started their own companies and try to help as many customers as possible, including Reese.
“I thought, ‘Don’t worry, Kirby, we’ll take care of it,’” Schmalz said.
Schmalz isn’t making a profit from the jobs Orange Elephant left, but he said it’s the right thing to do.
“I was so lucky,” Reese said. “I just feel terrible for the other people who really have nowhere to turn.”
By some estimates, there are approximately 350 consumer victims of Orange Elephant nationwide, with 180 of them in Illinois. This does not include subcontractors and suppliers, who also lose countless thousands of dollars.
Orange Elephant is also facing several lawsuits.
The Illinois attorney general said it has also received more than a dozen complaints about Orange Elephant so far.
