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hole in basement cinder block

Basement wall is leaking where old septic tank line came into basement. I am told when the city switched to city sewer and water the septic pipes were capped off by simply packing the pipe from the inside of the basement with cement. Well it didn't work, because we now haave water seeping in through that pipe and around that pipe into the basement-even with the concrete packing inside the pipe! After scraping the patch job that was around the pipe in the basement-I can see clear through to the concrete that was used to patch the outside of the wall! What should I do? I can't imagine I am the only one who has had a problem with a capped off septic pipe leaking? We now have a hold in the wall that leaks with an old rusty pipe stuck in it as well-do we try to fill the area surronding the pipe with epoxy, concrete or foam? We also know we have to dig down in the spring on the outside, patch, tar and put plastic over the hole to stop water from seeping in right?

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