John Scarry is a whistleblowing engineer who is criticising the Government and the industry for shoddy practices

There's the bank, the car dealership and the tyre shop. The bike store, the booze store and the real estate firm.

Take a walk around the streets of Masterton, the 23,000-strong beating heart of the Wairarapa region, and you wouldn't go far before seeing one of the near-new commercial properties, the product of a thriving rural economy and a civic centre that takes great pride in its appearance.

But take a closer look, and cracks start to appear.

JASON DORDAY / FAIRFAX NZ Whistleblowing engineer John Scarry is critical of the Government for shoddy practices in the building industry.

A Stuff investigation has found 13 near-new buildings have structural weaknesses in Masterton, raising fears of systemic failings in the engineering industry.

READ MORE: Nationwide building boom creating next leaky buildings crisis

The design faults, which were not picked up by council, reduced five of the buildings' seismic strength status to "earthquake prone".

PIERS FULLER / FAIRFAX NZ TRC Toyota in Masterton was one of the first six buildings to undergo a detailed seismic review, which showed it was well under code.

Now the owner of two of the buildings is struggling to find anyone accountable for the costly errors.

Faulty design work was first discovered when a private Masterton developer Percy McFadzean commissioned a seismic review of a building he constructed in 2005 to be leased to ASB Bank on Masterton's Queen St.

The initial report found serious design flaws that made the new building earthquake prone. These findings were backed up by two more detailed reviews conducted by independent structural engineering firms.

MARTIN HUNTER / FAIRFAX NZ The Duke and Duchess of Cambridge lay a wreath at the site of the CTV Building during a 2014 visit.

McFadzean, who also owns a second building next door affected by similar problems, undertook "an extensive and costly seismic upgrade" to bring the buildings up to current code.

The scale of shoddy engineering work was dramatically expanded when a member of the Institution of Professional Engineers New Zealand (IPENZ) alerted the Ministry of Business, Innovation and Employment (MBIE) that buildings constructed by community-owned organisation Lands Trust Masterton over the last 12 years shared similar design characteristics.

Initial seismic assessments revealed all of the buildings contained potential deficiencies and warranted more detailed analysis.

PIERS FULLER / FAIRFAX NZ The ASB Bank in Masterton was the first building identified as containing structural flaws and has undergone remediation work to bring it up to code.

Detailed seismic reviews of six of the trust's buildings revealed three were earthquake prone, meaning they are at less than 34 per cent of the New Building Standard, and three others were under 67 per cent of code.

Five other buildings are now undergoing detailed seismic reviews with initial assessments putting them at between 50 and 70 per cent of code.

The 13 buildings in Masterton were all designed by engineering firm Kevin O'Connor & Associates which is also responsible for designing many buildings around the country, including schools and libraries.

PIERS FULLER / FAIRFAX NZ Brews (formerly Liquor King) has undergone remediation work.

Kevin O'Connor & Associates was contracted to complete the engineering design for each of the Masterton buildings with several different designers from the firm signing off on the various projects.

Firm principal Kevin O'Connor says they are treating this matter "with the utmost seriousness" and investigating further.

"We are currently reviewing the reports. Consequently we are unable to comment further on the reports at this time. We will always meet our legal obligations."

PIERS FULLER/ FAIRFAX NZ Beaurepaires in Masterton is one of several buildings that has had a detailed review of its seismic strength.

Percy McFadzean believes his buildings have uncovered a problem which could be the tip of the iceberg.

"Some aspects of the buildings were (similar to) CTV stuff - just not up to code," he said, referring to the CTV building that collapsed in the 2011 Canterbury earthquake, killing 115 people.

In the wake of the Canterbury earthquakes of 2010 and 2011, the Government undertook a dramatic overhaul of seismic strengthening regulations.

JASON DORDAY/FAIRFAX NZ "A reviews B's designs and B reviews A's designs and, lo and behold, everything's hunky-dory." John Scarry says tighter regulation is needed.

A Royal Commission of Enquiry found the CTV building's structural design was deficient and should not have been approved.

McFadzean said while he had huge respect for good engineers, he wanted to see those responsible for shoddy work held to account.

"My view is that they need to be held accountable and there's a public safety issue for the other buildings they have designed.

PIERS FULLER / FAIRFAX NZ Mico Bathrooms in Masterton has had a detailed seismic review which shows it is well under code.

"They should be going through every building of this type that this firm has had something to do with."

The engineer responsible for uncovering the design flaws in McFadzean's buildings, Michelle Grant of LGE Consulting, said it was important for public safety that engineers' work meets code.

"Structural engineers design buildings that our friends and family work in, shop in and visit," she said.

PIERS FULLER/ FAIRFAX NZ Carpet Court in Dixon Street, Masterton has had a detailed seismic review assessing as under code.

She notes that IPENZ is actively engaging with the profession on these issues, and looks forward to hearing their progress.

The discovery in Masterton was symptomatic of an industry in dire need of reform, according to engineering whistle blower John Scarry, who has written reports of the "parlous state" of engineering and construction in New Zealand.

"It's just another example of what I have been talking about since 2002. There are serious systemic problems and the Government has refused to deal with it," he said.

PIERS FULLER / FAIRFAX NZ The earthquake rating of near-new AvantiPlus Masterton in Chapel St is now under code.

Scarry blames the Government and councils for getting rid of their technical expertise and abrogating their responsibility to outsourced peer review.

"The peer of an idiot is an idiot. And in many cases the company that is doing the design gets to basically nominate the company to do the peer review and it's basically A reviews B's designs and B reviews A's designs and, lo and behold, everything's hunky-dory."

Both IPENZ and MBIE have said while they have the power to investigate the work of a particular engineer on a project, they cannot investigate the entire body of work of a company.

Initial assessments puts Lone Star in the Seddon Building in Dixon Street at between 50-70 per cent of code.

MBIE spokesman Britton Broun says the ministry is considering how they might issue advice to engineers and councils around any design factors raised in the reports they commissioned on the Masterton buildings.

"This will allow engineers to check any commercial buildings they may have designed and for councils to check any commercial buildings they may have consented."

It is within IPENZ powers to investigate a complaint about an individual member engineer but it cannot investigate a firm's work.

PIERS FULLER / FAIRFAX NZ Initial seismic assessment of the Elliott Building in Queen St Masterton showed it is potentially under code.

"IPENZ doesn't have any jurisdiction over firms or buildings. We understand the responsibility for reviewing buildings sits with territorial authorities, with MBIE being the monitoring agency," said IPENZ chief executive Susan Freeman-Greene.

"Based on the information in the public domain, something in the checks and balances process doesn't appear to have worked here. We all need to work together to get to the bottom of this."

While IPENZ has not yet received complaints regarding engineering work done on the Lands Trust Masterton buildings, Stuff understands a complaint has been upheld recently against an engineer that designed another commercial building in Masterton.

PIERS FULLER / FAIRFAX NZ A single storey addition to the Farmlands in Chapel St Masterton has also having a detailed review after failing its initial assessment.

Due to conditions imposed by the disciplinary hearing IPENZ will not name the engineer, the company the person works for, the building or disclose what disciplinary action was taken.

The impact of the design failures will have far reaching consequence for Lands Trust Masterton which uses its income from its $71 million commercial property portfolio to support education and cultural initiatives in the region.

It's affected buildings are worth around $15 million and remediation and associated costs are expected to be several million.

PIERS FULLER / FAIRFAX NZ Supercheap Auto in Masterton has been identified by an initial seismic assessment as being under code.

Masterton will recover, but other towns will now be asking if their new banks, bike stores and booze shops are safe.

Know more? Email piers.fuller@fairfaxmedia.co.nz

COMING UP TO CODE

PIERS FULLER / FAIRFAX NZ The FMG Building on Dixon Street was one of the first six Lands Trust Masterton buildings identified as being under code.

New legislation due to be introduced next year aims to fix problems in managing earthquake-prone buildings under the Building Act 2004 identified by the Canterbury Earthquakes Royal Commission, and as part of a Government review.

The Building (Earthquake-prone Buildings) Amendment Act 2016 will come into effect on 1 July 2017.

The new legislation standardises the rules and processes that apply to identifying and remediating earthquake-prone buildings. It is designed to be a nationally consistent approach to managing the risks posed by earthquake-prone buildings. Under the current system, which was introduced a decade before the Canterbury earthquakes, local councils were asked to develop their own systems for identifying and managing these risks.