Some home inspectors say the nation's largest real estate company has a policy that puts homebuyers in jeopardy.

The dispute centers on Coldwell Banker's practice of referring customers to inspectors who pay a fee to be on a preferred list.

The following report by Team 4 investigative reporter Paul Van Osdol first aired Nov. 24, 2004, on Channel 4 Action News at 5 p.m.

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It's called a concierge service. Coldwell Banker says it's a convenience for its customers, saving them time. But some local home inspectors say it creates a conflict of interest for inspectors that could put homebuyers at risk.

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Tom O'Connor, Malcolm Whipkey and John Vaccarello have more than a half-century of combined experience doing home inspections. Whipkey is president of the local chapter of the American Society of Home Inspectors. O'Connor and Vaccarello are past presidents.

If you check Coldwell Banker's list of preferred home inspectors, the three men are nowhere to be found. Their association has ruled it's a conflict of interest for them to pay a fee of up to $500 that's required for them to be on the list, and they say homebuyers should question inspectors who pay that fee.

Vaccarello: "It puts a question in the back of somebody's mind -- who is he working for?"

O'Connor: "I think it does compromise you. None of the other real estate companies have asked for any money from me."

No other local real estate companies have a list like Coldwell Banker's.

Earlier this year, O'Connor wrote Coldwell Banker agents, asking them to consider using him even though he is not on the list. Coldwell Banker responded in its newsletter, warning agents that if they recommend a home inspector not on the company list, they do it at their own risk.

O'Connor: "Coldwell Banker was easily 25 percent of my business, and it almost totally disappeared."

Meanwhile, Structural Dimensions Inc. has picked up more business from Coldwell Banker. It's one of the preferred home inspectors on the list.

Earlier this year, Team 4 found Structural Dimensions had more lawsuits and judgments against it than any other home inspection company in Allegheny County. The most recent count: 12 judgments. It's also the only local home inspection company with a negative rating from the Better Business Sureau.

Company President Fred Goehringer says he sees no conflict in being on the Coldwell Banker list. He tells Team 4, "I can't imagine anyone in their right mind overlooking a defect like a bad roof to keep Coldwell Banker pleased, so they keep referring inspections to them."

Other inspectors on the Coldwell Banker list also told Team 4 their judgment has not been compromised. None of them agreed to be interviewed on camera.

Inspectors who are not on the list have a different perspective.

Whipkey: "If you break too many deals, you're probably going to be in trouble remaining on the list."

There's no evidence Coldwell Banker has yet removed an inspector for breaking deals.

The company declined Team 4's request for an interview.

Coldwell Banker issued this statement:

"Any home inspector who is licensed by the state of Pennsylvania and maintains the state-mandated insurance requirement to protect the homeowner is able to join Coldwell Banker Pittsburgh's concierge program."

The company says it charges inspectors a "minimal cost" for advertising. It also says the program does not violate Pennsylvania's home inspection law.

Whipkey says home inspections are too important for anything to compromise the inspector's independence.

Whipkey: "At least one inspection every week, there's some life-jeopardizing home inspection defect that really needs to be repaired."

ASHI has ordered all its members to leave the Coldwell Banker list. A statewide group that represents ASHI and another inspectors' association has also come out against preferred vendor lists like Coldwell Banker's.

We should point out that there are other contractors on the Coldwell Banker list, like electricians, plumbers and painters. We wanted to ask if Coldwell Banker does background checks on these companies, but they declined to talk to us.