Lembke Construction owner pleads guilty to $28K in payment thefts

(ABC 6 News) – The owner of a former Albert Lea construction business pleaded guilty to one of three felony theft charges in Freeborn County Court Monday.

Douglas Lyle Lembke, formerly of Albert Lea, entered a guilty plea to the charge of Theft of Payment for Real Estate Improvement Nov. 13, which was accepted Nov. 18.

Lembke’s sentencing is scheduled for Jan. 30, 2025.

According to the Better Business Bureau, Lembke Construction’s license was revoked after reports that consumers had paid in full for projects, but the subcontractors and suppliers were not paid.
“The business’s failure to follow through on promises to reimburse consumers demonstrates that they untrustworthy, financially irresponsible, or otherwise incompetent or unqualified to act under the license granted by DLI,” the BBB website reads.

Lembke’s license and business registration were revoked, and he was ordered not to offer construction or roofing services in the State of Minnesota, according to the Better Business Bureau.

Lembke now lives in Katy, Texas, according to court records. There is a business filing for a Lembke Construction in the same city.

According to Lembke’s criminal court records, in May of 2023, the Albert Lea police department began investigating a complaint that a couple had paid Lembke Construction for a residential improvement, but later received a lien from a contractor who charged them for materials used.

The total bill from Lembke, they told police, had already included demolition of the old deck, materials and labor, and installation of the new structure for nearly $70,000 according to court documents.

The customers then learned that Arrow Building Center, a subcontractor, filed a $20,235 lien against them. They told law enforcement Lembke had told them not to worry about the lien, that he would pay Arrow Building Center in a little longer.

They also told law enforcement about two other homes that may have had similar problems with Lembke, according to court documents.

Arrow Building Center had billed the other two customers for more than $4,000 each, police learned, after Lembke withheld those payments from the contractor.

According to court documents, police spoke to several Lembke Construction employees, who confirmed that Douglas Lembke was responsible for receiving checks and paying bills.

One employee said Lembke hadn’t had enough money to pay Arrow Building Center, and that he was surprised there weren’t more complaints to law enforcement since Lembke hadn’t been paying said bills or answering his phone.

Another employee, who helped with receiving and depositing checks, told police that Lembke had cleared out all the books and paperwork “when he left” the business.

The employees had been told they didn’t have jobs suddenly, and hadn’t received their final wages, court documents allege.

According to Lembke’s plea agreement, the business owner pleaded guilty to only one charge of theft of payment, but agreed to pay restitution in all three cases.

In exchange, he will not receive any jail time.

“If restitution is paid in full by the time of sentencing, the State agrees that the
court shall impose a stay of adjudication of sentence,” the plea agreement reads. “However, if restitution is not paid in full by the time of sentencing, the parties agree the court shall order a stay of imposition of sentence.”