There is no permit.....
He (the neighbor) knows that the NM is not code.
It seems to me that those facts pretty much point to the way to deal with this. You just tell him, "When you asked me to do this, I assumed that you would have the proper permits, and that that job would conform to the building codes. As a licensed EC, I cannot, and will not, work on an unpermitted job, in violation of Code. Were I to do so, I would risk loosing my profession, and my livelihood."
