A contractor involved in the Christchurch rebuild is being investigated following allegations of fraud.
The contractor is alleged to have been involved in collusion over pricing, as well as invoicing for work not done.
Earthquake Commission (EQC) customer services general manager Bruce Emson says an investigation into the contractor's activities was sparked after staff noticed concerning patterns in pricing.
"While the investigation isn't complete, it appears the majority of the money will be able to be recouped as some payments are due to the contractor, which we will now likely withhold," Mr Emson said.
Though the majority of customers and contractors are genuine, there are a small number who will try to take advantage of the rebuild to benefit themselves, he said.
Any allegations found to have substance will be pursued, including referral to police if appropriate.