California brothers charged in Tiny home construction fraud case

The Sacramento County District Attorney’s Office claims the brothers diverted more than $653,000 from company accounts to cover unrelated expenses. The charges include 33 counts of diversion of construction funds, one count of conspiracy, and one count of employee wage theft for each brother.

The collapse of Anchored Tiny Homes has left numerous homeowners across California in a difficult situation, including elderly residents and families who had planned to build homes for relatives. Renee Kumamoto lost $168,000 intended for a home for her father, who is battling cancer, before construction began. Mariah Dorn accused the company of taking $266,000 from her elderly parents, leaving them with an unfinished structure.

Dorn’s Facebook post in July 2024 highlighted issues with unpaid subcontractors and liens placed on properties. The California Contractors State License Board received over 200 consumer complaints spanning 18 counties, leading to the revocation of Anchored Tiny Homes’ contractor license in November 2024.

Retired nurse Jan Truelock paid over $40,000 for a 450-square-foot home in Roseville, which was promised to be completed within a year. She eventually settled a breach of contract lawsuit for $25,000. Truelock expressed hope for prison time for the brothers.

Colton Paulhus, in a Facebook post in December 2024, acknowledged the business failure but denied any illegal activity, attributing the downfall to rapid growth and insufficient funding. Austin Paulhus’ attorney, Blair Goss, echoed this sentiment, stating that business failure does not equate to criminal behavior.

The brothers appeared virtually in court on October 14 and did not enter pleas. They are also seeking bankruptcy protection. The case is scheduled to return to court on January 12.