By Anthony Segaert and Olivia Ireland
The man whose company built a Condell Park home that collapsed in the dead of night last year has pleaded guilty to a string of fraud-related charges.
Thirty-five-year-old George Khouzame, director of Hemisphere Constructions, was on the run from authorities for nearly two months at the beginning of the year, before he handed himself in to NSW Police in March.
George Khouzame, responsible for the Condell Park home that collapsed shortly after being built, has pleaded guilty to various fraud charges.Credit: Kate Geraghty / Supplied
Khouzame, from South Hurstville, pleaded guilty to nine offences relating to using an unlicensed contractor and the fraudulent lodging of insurance applications on three different worksites, but Building Commission NSW and the state’s police failed to secure any prosecutions relating to the Condell Park home collapse.
When asked about the charges, Khouzame told the Herald that, after having his building licence cancelled shortly after the collapse, he had paid out “every single home owner” who had contracted him for work and his fraudulent insurance claims were “just negligence from my office”.
“It was a very, very, very, very low-end fraud. It was literally an honest mistake from my staff in the office,” he said of the nine convictions: three charges of publishing misleading material to obtain financial advantage, two charges of dishonestly obtaining financial advantage by deception, three charges of making false or misleading statements in an insurance application, and one charge of engaging an unlicensed contractor.
Investigation began before the collapse
Attention turned to Khouzame and his company on Good Friday last year, when a young family renting the home built less than 12 months earlier was woken at 4.30am by the sound of the ceiling collapsing.
Neighbours described hearing what sounded like an explosion as a portion of the house in Sydney’s south-west fell down, hitting several cars parked underneath. A previous tenant of the property said one room had earlier “completely flooded”.
But the collapse was less surprising to authorities, who had launched an urgent investigation into Hemisphere Constructions a month earlier. Only a day before, NSW Building Commissioner David Chandler had made an unannounced visit to a worksite in Concord operated by Hemisphere Constructions and found what he described as “pretty obvious” unsafe work practices.
“There is a strong correlation between unsafe worksites and the potential for serious defects to be incorporated in the project,” he told the ABC.
After cancelling Hemisphere’s building licence the following month, Fair Trading, the predecessor to Building Commission NSW, and investigators from Bankstown Police spent the year looking into the company. By January, they were ready to arrest Khouzame.
On visiting multiple homes connected to him, they encountered a problem: Khouzame was nowhere to be found.
After another month of searching, NSW Police obtained an arrest warrant and appealed to the public to find the wanted man.
“George Khouzame, aged 34, is wanted on an outstanding warrant in relation to fraud offences,” NSW Police posted on social media. “Anyone with information into his whereabouts is urged to not … approach him but to call triple zero (000) immediately.”
He handed himself in at Bankstown Police Station at 5.30am on March 6, and was arrested on the spot.
‘You should be saying thank you’
The builder in May pleaded guilty to the offences relating to his management of homes in Punchbowl, Macquarie Fields and Chester Hill.
At two of the three sites, Khouzame significantly understated how much his building projects were worth on insurance applications.
For a Macquarie Fields dual occupancy construction project worth $900,000, Khouzame was accused of writing in his Home Building Warranty Insurance that it was worth $520,000.
“Had the correct value of construction been stated on both insurance applications the value of the insurance premiums would have totalled $14,799.00 creating a deficit of $7517.94,” the facts tendered to the court read.
For a home renovation in Punchbowl, Khouzame listed the construction value to the insurance provider as $150,000 instead of $400,000.
He also pleaded guilty to engaging an unlicensed contractor to install windows and doors at a site he was renovating in Chester Hill.
Khouzame, who called the Herald on Wednesday from a private phone number after numerous attempts to contact him for comment, said the offences were “all they [the investigators] could come up with over a 10-year investigation and 350 homes”.
“The charges were dismissed in relation to the fraud and I pled guilty to only one charge for the home warranty application,” he said. “OK buddy?”
But after the Herald read out his nine offences, to which he pleaded guilty and was fined a total of $5450, Khouzame repeated his claim that it was “very minor fraud”.
“We failed, our staff failed, to update the home warranty to reflect the variations [in project costs] … It was just negligence from my office, and I did accept it, and I apologised.
“So we had existing 24 open projects when the house collapse happened and the licence was cancelled, and we paid out every single home owner and every single client.
“I didn’t run away from the problem. I approached the problem head on and I [had] done what I had to do to make sure that every client and every home owner has been supported by me personally.
Building Minister Anoulack Chanthivong says the charges reflected the new powers of the Building Commission.Credit: Chris Lane
“You should be saying, ‘Thank you, good work’.”
In its first six months, Building Commission NSW has cancelled, suspended or disqualified 136 construction licences.
“We’re starting to see the dividends of the expansion of powers the NSW government provided to the Building Commission,” Building Minister Anoulack Chanthivong said.
“It now has an expanded tool kit to improve build quality and weed out those who don’t play by the rules.
“Already this year, we’ve had a nearly 100 per cent increase in the number of building work rectification orders issued, helping to deliver compliant, safe and trustworthy homes.”
Chanthivong did not respond to questions about why charges had not been laid over the house collapse.
With his licence suspended, Khouzame is now working as a labourer for a friend’s food company.
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