New Zealand’s EQR Staff Blow Whistle on Contractor Fraud

Staff working at New Zealand’s Earthquake Commission have played a crucial role in stopping potential fraud and collusion by a Christchurch-based contractor and a hub quantity surveyor respectively.

EQC General Manager Customer Services, Bruce Emson, says an investigation into the alleged activities is nearly complete. The alleged activities were collusion over pricing and invoicing for work not done.

“The activities were brought to our attention both by alert EQC hub staff, who noticed concerning patterns in pricing by a particular contractor, and by Fletcher EQR’s systems.

“While the investigation isn’t complete, it appears the majority of the money will be able to be recouped as some payments are due to the contractor, which we will now likely withhold.”

Emson says once the investigation is complete, it is likely that all homeowners whose properties were repaired by the contractor will be contacted and their repairs reviewed to ensure they are completed according to the agreed scope.

Fletcher EQR General Manager David Peterson says it is extremely disappointing if the alleged fraud has occurred, but the fact it was detected shows the systems that are set up are working well.

“Our staff do not want to be associated with activities that bring our work in the Canterbury recovery into disrepute, so when allegations of fraud come to light they are taken seriously at all levels of the business.

“While this shows our systems are working, we can and will learn from what has taken place at the Middleton hub and improve our ability to prevent and detect attempts to distort pricing for personal gain.”

Emson says contractor fraud, like claims fraud, is stealing from all New Zealanders, and will not be tolerated.

“While the majority of our customers and contractors are genuine, there is a small number who will seek to take advantage of the rebuild to benefit themselves.

“While the investigation is underway natural justice has to prevail, but any allegations that are found to have substance will be pursued to the limit of our ability, including referral to Police if appropriate.”

Source: EQC