Issue Date:  -  Thursday, 7 September 2006

Unregistered builder and bankrupt a menace to consumers

Consumer Protection is warning consumers not to deal with unregistered builder and bankrupt Steve Preston after numerous complaints about his activities.

Mr Preston operates the business Preston Developments and is associated with a company named Building Enterprises Group Pty Ltd. They have links to disgraced former finance broker John Margaria.

Consumer Protection Commissioner Patrick Walker said Mr Preston is entering into building contracts valued at between $8,000 and $282,000 and asking for hefty deposits before any work is done.

“Consumers allege that, after Mr Preston took their deposits, little or no work was carried out beyond laying the slab,” Mr Walker said. “This has left the homeowners tens of thousands of dollars out of pocket.”

Mr Preston is not a registered builder and, under the Builders’ Registration Act, cannot undertake work valued at more than $12,000. By misrepresenting himself as a registered builder to consumers, he is also suspected of running foul of the Fair Trading Act.

“It is alleged that Mr Preston is flouting the law by getting the homeowner to take out an owner-builder licence while he carries out the building work,” Mr Walker said. “It is unlikely that Mr Preston has taken out home indemnity insurance which further puts consumers at risk.”

The Builders’ Registration Board is prosecuting Mr Preston for contraventions of the Builders’ Registration Act 1939 and Home Building Contracts Act 1991. The contraventions relate to unregistered building work, failing to take out home indemnity insurance, and taking deposits in excess of the 6.5% allowable under the Home Building Contracts Act.

Last month, the Building Disputes Tribunal (BDT) ordered Mr Preston to pay two homeowners a total of more than $93,000. The BDT ruled that he had no intention of complying with his obligations to commence the work within a reasonable time.

In 2004, the Australian Securities and Investments Commission (ASIC) obtained Federal Court orders restraining Mr Preston from advertising a superannuation scheme without holding the necessary licence.  Last year, the ASIC obtained orders restraining Mr Preston from carrying on a business relating to superannuation interests.

This year, the Assistant Deputy Commissioner of Taxation disqualified Mr Preston from holding a responsible position with a body corporate involved in superannuation entities.

On 25 August 2006, Mr Preston declared bankruptcy owing 27 debtors some $439,206. This is the second time he has been declared bankrupt in 12 years.

“I am extremely concerned about Mr Preston’s past and current activities and urge homeowners to strongly consider steering clear of him and his businesses,” Mr Walker said.

Consumers who have queries or complaints about Mr Preston can contact the Builders’ Registration Board on 9476 1200.