23 Jan 2013

Another agency may probe sub-contracts, says SFO

7:26 am on 23 January 2013

The construction industry is set to face closer scrutiny after the Serious Fraud Office closed its investigation into one of New Zealand's largest privately owned construction companies, Hawkins, without laying charges.

Last August the SFO swooped on two premises relating to Hawkins and the $419 million upgrade of Transpower's Hobson Street substation in Auckland that it is project-managing.

The office had received complaints about the fixing of sub-contract prices in contracts.

After probing thousands of documents and extensive interviews the SFO said it found no grounds for a criminal prosecution.

SFO acting chief executive Simon McArley said the parties had differing misunderstandings about the contracts and prices, but no evidence emerged that Hawkins intended to deceive.

Mr McArley said he gained an insight into the contracting nuances of the construction industry, and it won't be the last time he investigates aspects of the industry.

The issue may need to be taken up by another government agency, he says.

Mr McArley said there is a high level of uncertainty around contracts and subcontracts in the industry.