CTS Consulting

High-Profile Strata Company Netstrata Caught Charging Excessive Fees And Taking "Kickbacks" - ABC 7:30 Report

Coralie Mott
Managing Director & Certified Body Corporate Consultant

A recent broadcast on ABC’s 7:30 PM program has brought to light a pervasive issue within the Body Corporate Management sector: the presence of undisclosed financial arrangements between body corporate management firms and service providers. Of particular concern are the practices observed among Insurance Brokers, who allegedly inflate body corporate premiums to accommodate these undisclosed benefits, often referred to as “kickbacks”. As reported by the ABC, “an industry-wide inquiry revealed in December 2022 that the strata insurance industry was beset by “conflicts of interest” that “can result in over-compensation”. “Examples have come to light of remuneration levels that, to the outside observer, appear to be excessive” (ABC News, 2024).


As someone who has long advocated for greater transparency and accountability in this industry, the exposure of such dishonest practices on a major news platform like ABC is a welcomed development. It is reassuring to see this issue receiving the attention it deserves, and I am confident that this is just the beginning of a broader conversation. It’s likely that we will witness further scrutiny and exposure of these unethical practices in the future.


My primary focus in the founding of my own Body Corporate Management firm, CTS Consulting Body Corporate (previously CTS Management) has consistently been to serve the interests of lot owners; upheld through ethical practices, transparency, and integrity. Regrettably, this vision frequently diverges from prevailing industry norms and standards.


I am proud to say that CTS Consulting Body Corporate continues to stand out as one of the only providers in Queensland adhering to a strict commission/sponsorship-free policy on all services, including insurances. Our policy is pivotal in eliminating extra costs associated with commissions and undisclosed payments, which often lead to higher expenses for bodies corporate and, consequently, increased levy contributions for the lot owners.


Implementing a no-commission/ sponsorship policy in our business has occasionally placed us at a competitive disadvantage compared to other strata management companies. This disadvantage becomes particularly evident when owners vote on a motion for a strata management company, focusing primarily on the strata management ‘agreed’ fee outlined in the motion. Strata managers who derive ancillary income from commissions and other undisclosed sources will often present their strata management fixed contract fees at a significantly lower rate. Additional income is then attained through Bodies Corporate through additional ‘hidden’ fees in their contracts, which are often paid by the Body Corporate Manager without approval. Strata Managers will also pushing their preferred suppliers onto Bodies Corporate, receiving additional commissions, sponsorships and other payments from these suppliers.  Consequently, unsuspecting strata buildings, are initially enticed by the prospect of a better deal, but often experience buyer’s remorse upon discovering increased expenses due to the hidden costs tied to their strata manager’s commission/payments – based income. These payments are often ‘recovered’ by the supplier by billing the Body Corporate at inflated rates.


Our business had the option to follow the path taken by the vast majority of strata managers. However, I chose to prioritise integrity at CTS Consulting over financial gain – this has come at a personal cost to our business. Opting not to stoop to the lows witnessed in this industry, we have embraced the opportunity to lead by example, serving as a beacon of transparency and ethics in a sector that is in dire need of such values.


In the current landscape, it is paramount that advocacy efforts continue, in the pursuit for influence and change within an industry that lacks protective standards.


If you’re aware of any properties struggling with transparency issues or if you are interested in finding out if your Body Corporate is being charged excessive commissions or applicable fees, please contact us. We are here to help.  CTS Consulting is able to analyse expenses and provide further information on areas that could attract potential savings for your Body Corporate.  


By choosing and referring ethical services like CTS Consulting Body Corporate, you contribute to the momentum for change.