About Me

My photo

I am a qualified Attorney. I specialise in Property Law, Commercial Law, Corporate Law and Trusts.
 
Please visit our website at www.prop-law.co.za for more details.
 
I am an elected Committee Member of the Property Committee of the Association of Pretoria Attorneys and through my involvement, I like to ensure that I am constantly at the "sharp-end" of Conveyancing Practice.

I am the elected Chairman on the Gauteng Council of SAPOA. The South African Property Owners Association (SAPOA) is the biggest and most influential institution in the property industry. SAPOA members control about 90% of commercial property in SA, with a combined portfolio in excess of R150 Billion (about $22 Billion). I am also on the National Council and the National Legal Committee of SAPOA.
 
Member of the Institute of Directors South Africa and Member of the Sirdar Governance Panel.

29 February 2012

EXCLUSIVE: Rael Levitt says it’s “personal”

EXCLUSIVE: Rael Levitt says it’s “personal”

Says allegations are a “well-orchestrated and well-funded” attack.

Allegations of foul play against Auction Alliance and its founder Rael Levitt are a “well-orchestrated and well-funded” attack on a company with a clean track record.

On Tuesday, Levitt stepped down as CEO of the company. In an exclusive interview with Moneyweb, Levitt spoke out on the allegations of kickbacks, ghost bidders and collusion levelled against himself and his business.

The claims stem from a Saturday Star report that a 13-year old paper trail revealed the company had paid kickbacks to attorneys, liquidators, and bank staff to ensure business went their way.

The report also stated that billionaire Wendy Appelbaum was disputing the legality of an auction where she bought the wine estate Quoin Rock.

The National Consumer Commission and the Estate Agency Affairs Board have confirmed that they are investigating Auction Alliance.

Auction Alliance’s board has also set up its own probe into claims of collusion between the firm and Levitt and banks, liquidators and attorneys.


SELF-SERVING ATTACKERS

“It is a personal attack on me. Because I started the business at the age of 20, I am the face of the brand - any attack on me is an attack on Auction Alliance. It has been well orchestrated and well-funded," Levitt said.

He added: “Three weeks ago we had an impeccable reputation and now we have been vilified by the media. It has come as an enormous shock to me that we have been dragged through the mud all through untested allegations, rumours and innuendo…

“My resignation must not be construed, in any way, as an admission or acknowledgement of any impropriety, illegality or wrongdoing on my part. I am voluntarily bowing out to allow Auction Alliance to be saved from the hysterical media scrutiny that has crippled our business with untested allegations, rumours and innuendos. I don’t think any reasonable private person could have withstood the one-sided media attention that I have over the last week – it simply was too much for me,” he said.

Levitt said that similar complaints had never been raised in the business’ 20-year history. In addition, he believes the largely anonymous sources quoted in the media are former Auction Alliance “employees now largely working in competitive auction companies”.

Referring to the recent Carte Blanche expose on Auction Alliance, Levitt said the coverage was “completely unfair, tabloid-style and selective. We are extremely disappointed with the manner in the way that Carte Blanche did not question the credibility and personal agendas of some of their sources.”

Levitt said only 15% of Auction Alliance’s business is generated from banks and liquidators and added that he was unaware of commission payments by Auction Alliance to bank employees, liquidators or court officials in their personal capacities. “… that said, we employ and have employed thousands of people and we are investigating each and every allegation through a firm of independent forensic analysts…


GHOST BIDDERS

“We have made it quite clear from the start that vendor bidding – what many people refer to as ghost bidding – is legal. The same applies to referrals to attorneys. What we have discovered is although they are industry norm and are lawful, the public finds them distasteful. That is one of the issues that our independent report will look into.”

According to the Consumer Protection Act, advance notice need to be given if a sale by auction is subject to a right to bid by or on behalf of the owner or auctioneer (vendor or ghost bidding).

“Sellers use vendor bidders, which is 100% lawful, to protect their reserve prices. Our role is to protect the seller’s asset and we thus use vendor bidders,” he said.

Levitt added that in the Quoin Rock case, the person bidding against Appelbaum was a proxy bidder and not a vendor bidder.

“At auctions we often have people who have either never bid before or do not want to bid themselves. In the case of Quoin Rock the R50m under bidder was bidding on behalf of a wealthy investor who was registered. He saw the media at the auction and specifically asked us to arrange someone to bid on his behalf. We arranged this through someone who has acted in the past as both vendor and proxy bidder for us.
“The mistake that we have made as a business is not clearly explaining the intricacies of auction methodology. Auction systems in South Africa, at Quoin Rock and globally are no different. And because we did not explain vendor bidding and proxy bidding clearly, the public finds it unethical and distasteful. For that mistake I have personally fallen on my sword. The mission of Auction Alliance has been to professionalise auctions and make them a first choice method of sale. The events of the last two weeks have taken our business and the auction sector back 20 years. It’s a devastating time for me to witness such a media disaster.”

...

No comments:

Post a Comment