First arrest over false quake claims

Insurance and demolition workers watch as the earthquake damaged building on the corner of Gloucester and Manchester Streets is demolished in Christchurch, 8 September 2010. Photo / Mark Mitchell.

Christchurch police have made their first arrest for false claims over earthquake damage, and suspect hundreds of claims will need investigation.

A woman has been charged with obtaining an advantage by false pretences for filing fake invoices and claiming earthquake repair work had been done when it had not, Detective Senior Sergeant John Rae told Radio New Zealand.

In a second case, police were investigating a contractor who appeared to be overcharging in his invoices.

Both cases had been referred to police by the Earthquake Commission (EQC.

They were the first of their kind for the earthquakes, but Mr Rae said he expected many more.

"Certainly studies that have been done on earthquakes or major events overseas has suggested about 10 per cent of claims made have some element of fraud involved," he said.

"I'm not expecting to receive 10 per cent of the claims made in New Zealand, but certainly we could be facing quite a few."

EQC chief executive Ian Simpson last week said his staff had contacted police after becoming concerned about the authenticity of some contractors' invoices.

A number of contractors were submitting invoices for work that was not done or not done to a high standard, he said. Some were also "greatly inflating" their hourly rate.

- NZPA