Victoria's Construction Sector Under Scrutiny for License Fraud
Thousands of buildings constructed by over 170 Victorian builders are undergoing fault and safety checks. This extensive initiative follows the discovery of widespread fraudulent builder registration schemes within the state's construction industry. Investigations into these schemes are ongoing, alongside critical efforts to reform industry oversight.
Corrupt Registration Schemes Identified
The suspect builders were allegedly registered through two distinct corrupt schemes:
- A three-year bribes-for-registration scam, currently under investigation by the Independent Broad-based Anti-corruption Commission (IBAC) in Operation Perseus.
- A scheme utilizing fraudulent paperwork and a loophole in Australia's mutual recognition agreements to register migrant workers for Victorian building sites.
Regulatory Response and Reforms
The Building and Plumbing Commission (BPC), which replaced the Victorian Building Authority (VBA) in June 2025, is now leading the efforts to address these critical issues.
A BPC audit of the bribes-for-registration scheme has already identified more than 170 builders who were allegedly corruptly registered. The BPC is actively inspecting up to three sites for each of these builders to ensure safety and competency.
Approximately 300 of 400 targeted buildings have been signed off, with 10 "direction-to-fix" orders issued where deficiencies were found. An additional 2000 completed buildings have been reviewed and cleared based solely on paperwork.
IBAC has charged 38 individuals, including three former VBA employees, in connection with the bribes-for-registration scheme. To date, seven builders have been convicted, and five of their registrations have been suspended by the BPC. Disciplinary action against other convicted builders is pending.
The BPC has stated it will continue to issue bans as criminal proceedings conclude, demonstrating a commitment to accountability.
To enhance integrity and streamline processes, the BPC is implementing a new licensing and registration model. This innovative model includes scrapping face-to-face interviews and exams to mitigate corruption risks, reducing documentation requirements, and introducing early risk detection assessments. This new system is expected to be fully operational later this year.
Background on Regulatory Challenges
Prior to its disbandment, the VBA faced significant scrutiny. This included a notable investigation into its workplace culture following the tragic suicide of a building inspector.
Reports also highlighted systemic issues within the authority, such as the use of unqualified staff in investigations and inspectors conducting visual audits rather than thorough physical site visits. These challenges ultimately led to the resignation of a former chief, underscoring the pressing need for comprehensive regulatory reform.