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Auction Alliance sets up ‘independent’ investigation

Posted On Thursday, 23 February 2012 02:00 Published by eProp Commercial Property News
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The board of directors has commissioned an independent investigation into allegations against the firm of unfair practice

Rael LevittAuction Alliance’s board of directors said on Wednesday it had commissioned an independent investigation into allegations against the firm of unfair practice, including using fake bidders and giving kickbacks.

After weeks of unrelenting pressure, Auction Alliance chairman Sango Ntsaluba said on Wednesday the board considered the allegations against its embattled CEO, Rael Levitt, to be of such a serious nature that such a step was warranted.

He said in order for the investigation to be properly conducted, the board would make no further statements until the investigation had been concluded.

Early this week, Mr Levitt offered to resign from the South African Institute of Auctioneers (SAIA) pending an investigation into his dealings.

The institute said Mr Levitt had offered to "step back" while allegations of payouts and kickbacks to liquidators, bank staff and attorneys were investigated by the Consumer Protection Commission and the Estate Agency Affairs Board.

The trouble started with the R55m sale of Cape Winelands estate Quoin Rock to billionaire Wendy Appelbaum, which led her to question the ethics and legality of the sale. Mr Levitt, in turn, is suing Ms Appelbaum for defamation after a bitter dispute over the Stellenbosch wine farm.

It emerged last week that his company is also a defendant in a long-running dispute over an upmarket Cape Town beachfront property, auctioned in 2008 to millionaire Suzette Main.

In a statement this week, SAIA chairman Tirhani Mabunda said Mr Levitt had been asked to excuse himself from any board meetings where the allegations would be discussed.

Auction Alliance last year received a highly critical high court judgment for "deliberately misleading" buyers into bidding for "one of the largest security resorts on the Garden Route".

A buyer who paid R50m was assured there were 71 luxury units and 62 serviced stands, with only a "loose tile here or there". He discovered 20 units were incomplete, there was no boundary wall, and the 62 stands were not serviced.

The Estate Agency Affairs Board has launched an investigation into Auction Alliance.

Last modified on Saturday, 09 November 2013 08:53

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