Victims criticise CMC report

HOMEOWNERS left out of pocket by the collapse of Coral Coast Homes and Steelsmart Homes have criticised a report by the Crime and Misconduct Commission, saying it did not investigate the matter fully.
At a public meeting hosted by Member for Burnett Rob Messenger on Thursday night, the former customers tallied the information they had against the report’s findings.
“When we went through the report line by line, it became clear that the figures did not correspond with the information that we have,” Mr Messenger said.

The report states the Building Services Authority only received three complaints from creditors of Coral Coast Homes between November 2008 and April 2009, but Mr Messenger believed more should have been registered.
“It appears that Steelsmart Homes was not investigated at all, and if that is the case, it is a problem that needs to be rectified because there are so many victims who have lost hundreds of thousands of dollars to Steelsmart.
“It also needs to be made clear whether tradespeople’s complaints were investigated,” Mr Messenger said.
He said he would ask questions on notice to Minister for Public Works Robert Schwarten about the investigation, including the credentials and background of the independent investigator who wrote the report.
Former Coral Coast Homes customer David Kapp said he was still out of pocket thousands of dollars that would not be covered by the BSA’s Statutory Home Warranty Insurance Scheme, and he wanted the matter investigated fully.
“Even though there is a question mark over whether it is a rigorous report, it’s amazing that it has found so many faults with the BSA’s record-keeping, legislation and staffing arrangements.
“It has swept too much under the table and under the carpet — the investigator hasn’t interviewed any of the customers,” he said.

Homes inquiry bites watchdog

THE BUILDING Services Authority has been told to clean up its act by the Crime and Misconduct Commission, after an investigation into the watchdog’s handling of the collapse of a Bundaberg building company.
The BSA came under fire after Coral Coast Homes went into liquidation in June, with allegations that it failed to investigate complaints from tradespeople and customers

While the CMC’s independent investigator found no evidence to support those accusations, he uncovered a number of systematic problems with the BSA’s policy and procedures guidelines, record-keeping, staff training and quality control of audits.
Read more on the collapse of Coral Coast Homes
Former Coral Coast Homes customer David Kapp and dozens of other customers lost thousands of dollars when the company went into liquidation after trading insolvent for up to six months.
Yesterday Mr Kapp was celebrating, after a six-month long battle for the BSA to be overhauled.
“The attention from the NewsMail and Rob Messenger has brought (the BSA) out to be the toothless tiger they have proved to be,” Mr Kapp said.
“It doesn’t help me, but I hope it will prevent any future problems like this one.”
In a letter to Member for Burnett Rob Messenger, the CMC criticised the BSA for systematic failures after an investigation was launched into the watchdog’s handling of the case.
Mr Messenger asked the CMC to conduct an inquiry after angry customers and tradies made allegations that the BSA failed to investigate their complaints.
BSA general manager Ian Jennings said he accepted the findings of the report.
“(We) will implement all the recommendations — that process has already started,” Mr Jennings said.
As a result of the recommendations, the BSA will employ qualified accountants, publish specific guidelines about how to deal with anonymous grievances, and create written policies guiding how to investigate complaints.
It will make the changes before April 19 next year.
Member for Burnett Mr Messenger said he was disappointed that the investigation was not carried out by CMC staff rather than independent examiner.
“Considering the seriousness of the allegations, the CMC should have used their own investigators,” Mr Messenger said.
“But nonetheless, this is as close to damning as I’ve ever seen from a government report — it has thrown up some serious faults within the system.”
He planned to table the document in Parliament last night.
Minister for Public Works Robert Schwarten denied the report found the BSA was in the wrong.
“The CMC did not make an adverse finding against the BSA and it is wrong to say the BSA is culpable of any misconduct as alleged by Mr Messenger,” Mr Schwarten said.
“In fact, the CMC identified a number of administrative matters which may assist the BSA in dealing with clients.”
The failed company owed more than $1 million to 100 creditors, who are yet to see a cent.
Liquidator SV Partners told the NewsMail last week

Tradie to keep 12k payout

LIQUIDATORS have backed down and retracted their demand for a Bundaberg tradesman to return thousands of dollars he was paid by the collapsed builder Coral Coast Homes earlier this year.
Bricklayer Kevin Bragg was shocked to receive a bill for more than $12,000 in September this year, when liquidators SV Partners determined he should return the money.
Citing legislation from the Corporations Act, SV Partners wrote that Mr Bragg “was aware or should have been aware that the company was insolvent” when his payments were made from January to March this year — despite the fact it was still trading when the payments were made, and did not go into liquidation until June.
The liquidators supplied a history of transactions between the failed builder and Mr Bragg’s bricklaying business Brickfred, which suggested that Coral Coast Homes may have been struggling financially as early as September last year.
They demanded that the money be returned, as it gave Brickfred a preference over other creditors, who may still see nothing of the money they have lost.
But luckily for Mr Bragg, SV Partners has eased its stance, and scrapped the repayment after media attention to the issue.
“They called me and asked me to write a letter detailing everything that happened with Coral Coast Homes, and they might be able to arrange something,” Mr Bragg said.
Last week, he had another telephone call saying the matter had been dropped.
Mr Bragg said he was delighted to hear the news, but said he should never have been asked to repay the money, which he was awarded by the Commercial and Consumer Tribunal in March, after Coral Coast Homes failed to pay him for work done before September last year.
SV Partners director David Stimpson said his investigations concluded the company was insolvent in January.
“Our investigations as to whether it was trading insolvently prior to that date are continuing,” Mr Stimpson said.
He said he had passed on a report to Australian Securities and Investments Commission (ASIC), stating that the company was trading insolvent, and was working on another report with further information.
He said Mr Bragg’s defence against the liquidator’s claim of an “unfair preference payment” was valid, and he would not be pursued for the money.
“At this stage we have not identified any other unfair preferences,” Mr Stimpson said.