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Media release: Stop HOW certificate scams

AAC Media release - 3 October 2013

Accredited Certifiers call for urgent tightening of NSW Home Owner Warranty Insurance arrangement to stop scams

The State’s peak body for Accredited Building Certifiers says it is aware of cases where builders are using fake insurance certificates, which are easily produced using desk-top publishing software, to hoodwink clients into signing home building contracts.

Home Owner’s Warranty Insurance is important because it ensures that home owners are substantially protected against financial loss in the event of defective building work or the financial collapse of their builder. Builders can save hundreds of thousands of dollars by faking them.
“We have become aware of projects where counterfeit insurance certificates have been issued and our concern is that there may be many more home owners at risk of serious potential financial loss if the problem isn’t rectified,” said AAC Executive Officer, Jill Brookfield.

“At present it is virtually impossible for an Accredited Certifier or a home owner to check the authenticity of an insurance certificate that has been provided by a builder. What we need is a secure system where insurers can upload bona fide insurance certificates and where certifiers and home-owners can log in and know they’re seeing the genuine article rather than simply being handed a potentially fake certificate,” Ms Brookfield said.

The Association of Accredited Certifiers, which supports professionals participating in the certification of building and subdivision works in New South Wales, is now calling for proposed changes to the Home Building Act and Home Owners Warranty Insurance Schemes that will hopefully prevent unscrupulous parties from issuing fake Home Owners Warranty Insurance Certificates, to be made immediately.

“The Minister for Fair Trading, Anthony Roberts, has indicated that there is the potential for the establishment of a public register of Home Warranty Insurance Certificates, which we would applaud, however such a portal must be fully accessible to Accredited Certifiers as the primary secure mechanism by which they can sight valid insurance certificates before issuing a Construction Certificate for a building project,” she said.

The Association of Accredited Certifiers would also like to see Home Warranty Insurance extended to include buildings over three storeys. These buildings currently do not require insurance and excluding them only places consumers at an unfair risk because they do not have the same level of consumer protection.

“All residential home purchasers must be protected in the same way regardless of the height of their building,” Ms Brookfield said.

Release date: 3 October 2013