What began as a plan to create affordable, comfortable backyard homes has become a costly ordeal for California homeowners who say they paid thousands of dollars only to be left with vacant lots or partially built structures.
Austin and Colton Paulhus, the brothers behind the now-closed construction firm Anchored Tiny Homes, each face 35 felony charges over allegations that customers were billed for projects that were never completed—or never started.
According to prosecutors, the brothers received more than $1 million for 13 projects while providing no labor or materials. Investigators also allege that over $653,000 was taken from company accounts and used for expenses unrelated to the construction work.
The criminal complaint filed by the Sacramento County District Attorney’s Office includes allegations of conspiracy, misuse of construction funds and theft of employee wages.
Both men have appeared in court without entering pleas. They have also sought protection through bankruptcy proceedings.
For customers who intended to use accessory dwelling units, or ADUs, to house relatives or create rental income, the case has offered a possible path toward accountability after years of financial and emotional stress.
Jan Truelock, a retired nurse, paid more than $40,000 in January 2023 for a 450-square-foot ADU behind her home in Roseville.
Anchored Tiny Homes estimated that the project would take about a year. But 12 months later, Truelock said no construction had begun and her backyard looked exactly as it had before.
Colton Paulhus, the former CEO and co-founder of Anchored Tiny Homes, faces 35 felony charges over allegations that customers paid for construction work they never received
After repeated delays and what she described as unanswered phone calls and emails, Truelock attempted to terminate the agreement. She said the company offered to return only $5,000.
She further alleged that Anchored Tiny Homes said $17,000 from her payment had already been spent on materials, though she never saw those supplies delivered to her property.
Truelock hired an attorney and filed a breach-of-contract lawsuit. The dispute ended with a negotiated settlement of $25,000, leaving her to absorb a significant loss.
She later hired Imkat to complete the ADU, which she said ultimately turned out beautifully.
Truelock said she welcomed the criminal prosecution, but told Realtor.com that a conviction should bring prison sentences for the brothers.
She also questioned whether most affected customers would ever see their money again, expressing concern that many may never learn what happened to the payments they made.
The complaints stretch well beyond Truelock’s property. The California Contractors State License Board has received more than 200 consumer complaints from 18 counties.
Many customers reported paying large sums for ADUs that were abandoned before completion—or for projects that never got off the ground at all.
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The brothers, including Austin Paulhus pictured in court, have appeared before a judge without entering pleas and are also pursuing bankruptcy protection
Retired nurse Jan Truelock paid more than $40,000 in January 2023 for a 450-square-foot ADU behind her Roseville home. Although the work was expected to take a year, construction never began
The company’s contractor license was revoked in 2024 as authorities continued investigating its collapse.
Katie Lucas paid Anchored Tiny Homes $211,000 in 2022 for a backyard residence in San Leandro that was meant to accommodate her mother-in-law and grandmother.
Instead, Lucas said the project was abandoned as little more than a shell. Contractors allegedly told her they had not been paid, even though she said she had paid the company’s invoices on time.
When her efforts to reach Anchored Tiny Homes failed, Lucas shared her experience online and found that she was far from alone.
A Facebook group created for affected customers reportedly attracted more than 1,000 members at its peak, with homeowners exchanging accounts of unfinished builds, stalled work and major financial losses.
Renee Kumamoto was another customer who said she suffered after paying $168,000 for an ADU intended for her father, who was undergoing cancer treatment. She said the company shut down only two weeks after receiving her final payment.
The company’s downfall came after a period of ambitious expansion. In 2023, co-founder Colton Paulhus spoke about franchising the business across the country.
Anchored Tiny Homes announced its closure in July 2024. Austin Paulhus said at the time that the company had expanded too rapidly and was no longer able to keep up with demand.
More than 200 complaints from 18 California counties were submitted to the state Contractors State License Board in connection with Anchored Tiny Homes
The brothers later filed for Chapter 7 bankruptcy. Contractors and franchise partners also said they were left with unpaid bills and losses.
The criminal complaint alleges that from January 2023 through July 2024, Colton withdrew $334,059 from company accounts and Austin withdrew $319,700 for expenses and activities unrelated to Anchored Tiny Homes projects.
Blair Goss, Austin’s attorney, told NBC Bay Area that his client was prepared to cooperate with investigators. Goss did not comment on whether Austin might testify against his brother.
The allegations have not been established in court. The brothers are scheduled to appear again in January 2027.
For homeowners still facing incomplete construction and drained bank accounts, however, the possibility of criminal convictions may provide limited relief unless the legal process also helps them recover the money they lost.
Our News Outlet has contacted Blair Goss and Hendrick Crowell, the attorneys representing Austin and Colton Paulhus, respectively, for comment.
