NSW Government Announces Inquiry into Strata Management Firm Netstrata
Following revelations on ABC's 730 program regarding exorbitant insurance fees and undisclosed kickbacks, the NSW government has announced an inquiry into Netstrata, one of the country's largest strata management firms.
The inquiry, to be conducted by an independent expert, will examine Netstrata's business practices, including fees, commissions, and relationships with third-party vendors. The government has committed to supporting the integrity of the process and receiving a detailed report, though it has not yet committed to making the report public.
This investigation comes after Netstrata's managing director, Stephen Brell, admitted to feeling "awkward" about his company's conduct and pledged to review and improve their practices. The ABC report alleged that Netstrata was charging apartment owners insurance brokerage fees up to three times the typical rate without disclosing this information. Additionally, the company was reportedly taking kickbacks from contractors and suppliers, failing to disclose these payments in annual reports as promised.
While Netstrata has apologized for any lack of transparency and promised an immediate audit, the company's conduct has sparked outrage among owners and advocates, particularly as it appears to have been permissible under current NSW law.
This inquiry represents a significant step towards ensuring accountability and transparency within the strata management industry. The findings of the investigation will be crucial in determining whether further regulatory action is necessary to protect the interests of apartment owners across the state.