‘It’s disturbing:’ Nassau County builder facing charges for not paying contractors, leaving homes unfinished

This browser does not support the video element.

CALLAHAN, Fla. — A Nassau County home builder is facing twelve charges, after families said he took their money, promising to build their dream home, and failed to pay the people who did the work.

Michael Chad Reed, 39, turned himself in Thursday and quickly bonded out of jail. He’s been charged with organized fraud, misapplication of construction funds, and grand theft, according to an arrest affidavit.

>>> STREAM ACTION NEWS JAX LIVE <<<

In total, documents showed there were five families who fell victim.

Spencer Kelly and his wife were one of them. They built their dream home in Fernandina Beach, but the process was far from smooth.

“Started a home in January ‘22,” Spencer Kelly said. “Mr. Reed started the construction process. We cleared land, and he disappeared about four months.”

Documents showed the couple provided a total deposit of $114,809.65 in agreement to build their home. According to Kelly, Reed finally returned their calls and they broke ground in May.

In total, the Kellys gave Reed more than $500,000, according to documents.

They moved in last November. But there were a slew of issues that needed to be fixed. Kelly showed Action News Jax photos of gashes and cracks in cabinets. There were windows with gas expanded in between panes and grout work was done poorly.

Kelly said Reed never returned to fix those issues.

[DOWNLOAD: Free Action News Jax app for alerts as news breaks]

“February rolls around, we have a contractor approach us saying we had outstanding bills. It was roughly $13,000 for a painter. He explained to me there were about three or four more outstanding invoices,” Kelly said. “We were shocked. It was to be expected some. Others were already in the process of firing him due to lack of movement on their home.”

Investigators said there’s no proof all of the money given to Reed was entirely used for construction, as many homes were left unfinished.

“We’re left holding a bag on something we gave him the money for,” Kelly said. “Only thing I can think of was it was spent elsewhere.”

[SIGN UP: Action News Jax Daily Headlines Newsletter]

One family in Callahan gave Reed $169,374.22 to build their home. In February of this year, a lien was placed on their home by a building company after it failed to get payment for the completed work. The home currently sits unfinished.

Kelly also had a lien placed on his home for a $400 door, which turned into $2,500 including attorney fees.

“it’s disturbing that people have to go through this. There’s individuals that have lost money. There are individuals who don’t have a house that started building a house. I’m lucky,” Kelly said. “We want retribution for the crimes committed. We don’t want restitution. We want him to know that you can’t do this to people.”

Click here to download the free Action News Jax news and weather apps, click here to download the Action News Jax Now app for your smart TV and click here to stream Action News Jax live.