Auction Alliance boss blasts claims of fake bidders
RAEL Levitt, the head of Auction Alliance, has offered to open his company’s books to investigators after allegations of improperly driving up auction prices and paying kickbacks – claiming this will prove that his company is clean.
“I would welcome any investigation – by the police, by the National Prosecuting Authority, anyone. Our books are absolutely open,” he said last night, speaking candidly for the first time since the allegations surfaced.
He was reported to have been paying kickbacks to liquidators, bank staff and attorneys, and made use of fake bidders to drive auction prices up.
“Not only have I not broken any law, but we’ve been at the forefront of cleaning up the industry. I’m a huge supporter of the Consumer Protection Act.
“I have worked with the Department of Trade and Industry to develop this, specifically to look after consumers’ rights. Instead, we’re being treated like a bunch of criminals, when we’ve actually been tried by the media. The media today think they are more powerful than a court of law,” he said.
“Considering our specific role in helping to regulate the industry, the allegations are bizarre.”
Asked whether his company had ever paid any illegal “kickbacks”, Levitt responded: “Absolutely not.”
Asked whether it was possible that any of Auction Alliance’s employees had broken any laws, he said: “I believe our systems are good. But we do employ around 300 people. To ensure that there has been no impropriety, we have appointed a private, independent forensic investigations company to investigate our internal systems.”
Levitt said it was also possible that the laws governing legal auctions were not properly understood. “So, since the auction, we have also looked at reviewing our systems to ensure that we have no practices which may be entirely legal, but may be considered to be unethical by the public.”
Insofar as this might refer to “vendor bidders”, Levitt said of the now-controversial Quoin Rock auction: “From day one, I have said that Mrs (Wendy) Appelbaum has been confused by the difference between a ‘proxy bidder’ and a ‘vendor bidder’ “.
The deal was regarded as one of the highest value liquidations in the Western Cape. The prestigious Quoin Rock Winery and Manor Estate belonging to businessman Dave King went on auction on December 10. The estate was sold by Auction Alliance to businesswoman and philanthropist Appelbaum, for R55 million, but the deal fell through. Appelbaum has since claimed that the auction process was “fundamentally flawed” and did not comply with the Consumer Protection Act, and that she was the only genuine bidder.
But Levitt maintains the auction was clean. “We hold 3 000 to 5 000 auctions a year, and there are often bidders who do not want to be in the glare of public cameras. ‘Proxy bidders’ simply bid on their behalf. At the Quoin Rock auction, there was a genuine bidder bidding with Mrs Appelbaum.
“She saw a proxy bidder – and saw someone who she thought did not have the means to buy the farms. But the ‘proxy bidder’ was indeed bidding on behalf of a bidder who has huge and significant means, someone who is extremely prosperous.”
Levitt said: “Newspapers have tried to rape our business. Think about this. We have not had one negative article in any of the Independent Newspapers in 20 years, and now suddenly there’s a slew. Do you seriously believe that if we were not a highly ethical business, that there would not have been articles in the past?
“This points to a witch-hunt with people with very serious agendas to hurt Auction Alliance, the auction industry, and myself.”
By Murray Williams