News
The article is more than 3 years old

Building management firms admit problems after Yle investigation

Building management firms were found to receive commissions on contracts from housing company spending. 

Kerrostalon lasitettuja parvekkeita.
Building management firms in Finland may have agreed unethical commissions on some contracts. Image: Henrietta Hassinen / Yle
  • Yle News

The Finnish Real Estate Management Federation says it has work to do to improve trust after an Yle investigation uncovered commissions paid to building management firms for services it purchased with housing company money.

Yle's investigative programme MOT saw documents suggesting the Realia property management company got a four percent commission on contracts for lift maintenance.

Some three million people in Finland live in properties owned by housing companies, in which individual property owners hold shares.

These housing companies usually buy building management services from real estate management firms, who then commission services from other firms and advise on maintenance schedules.

This means the real estate companies use housing company money, and are paid a fee for their services — so should not be accepting commissions on any contracts they are involved with.

The federation says its member firms have work to do in building trust and proving loyalty to their clients, the housing companies.

"The Federation of Real Estate Management Companies does not approve of bribery or corruption in any form," said the federation's Managing Director Mia Koro-Kanerva in a press release.

Yle's investigation uncovered the commission payments and procurement from related companies that occurred without tendering, which risks forcing housing companies to overpay for products and services.

The federation condemned these practices, and said building management companies need to ensure they work for their clients, and are fully transparent about their agreements.

Koro-Kanerva also said that housing companies should decide which firms get contracts they are paying for, and that they can reject the building managers' recommendations if they prefer another option.

The federation said that it is reviewing its ethical guidelines and oversight system, along with other organisations, to improve transparency and deal with any conflicts of interest.