Auction Alliance boss Rael Levitt has resigned from the SA Institute of Auctioneers (SAIA), the body confirmed Wednesday morning.
This comes as the beleaguered businessman hit back at allegations about his business practices, saying he had nothing to hide, and offering to open his company’s books to investigators.
This would prove his company is clean, he says.
In an interview with the Cape Argus Tuesday night, Levitt said: “I would welcome any investigation – by the police, by the National Prosecuting Authority, anyone. Our books are absolutely open.
“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. Prior, there was no protection for either buyers or sellers. 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 thinks they are more powerful than a court of law.
“Considering our specific role in helping to regulate the industry, the allegations are bizarre.”
The rumblings began in December when mega-wealthy Wendy Appelbaum questioned whether the auction of a Cape Winelands estate, Quoin Rock, had been run ethically and legally. She specifically questioned whether she had bid against legitimate or fake bidders.
Since then more individuals have surfaced with allegations against Auction Alliance, including that illegal commissions were paid to liquidators, attorneys and bank staff, and that illegitimate bidders were used to drive up prices at auctions.
Auction Alliance has vociferously denied the allegations.
Today, SAIA said Levitt had resigned after this week saying he would “step back” from the body. John Cowing, vice-chairman of SAIA, said this morning: “Yes, we are accepting Mr Levitt’s resignation. He hasn’t been pushed, he offered it, and we’ve accepted the resignation. In terms of supporting auctionists, I think it (Levitt’s move) is a good move. He can put himself up for re-election if he is found not guilty, once the investigation has taken place.”
The Cape Argus asked Levitt directly whether his company had ever paid illegal “kickbacks”, to which he replied: “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.”
Asked which firm had been appointed, Levitt said this was a “reputable South African auditing firm”.
He said it was also possible laws governing legal auctions were not properly understood. “So, since the (Quoin Rock) 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 unethical by the public.”
Insofar as this might refer to “vendor bidders”, Levitt said of the controversial Quoin Rock auction: “From day one I have said that Mrs Appelbaum has been confused by the difference between a proxy bidder and a vendor bidder.
“We hold 3 000 to 5000 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... ”
In an earlier response to the allegation of vendor bidding, Levitt said such bidding was internationally and nationally regarded as acceptable practice. It was also regulated, transparent and advertised.
Levitt said on Wednesday: “... 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?” – Additional reporting by Sibongakonke Mama - Cape Argus