The founder of Auction Alliance, Rael Levitt, is due to appear before the National Consumer Commission (NCC) on Tuesday to establish whether his conduct in the Quoin Rock Wine Estate auction amounted to fraud – but it is unclear whether he is in the country.
Levitt has previously missed three occasions to appear before the commission and could be served with an arrest warrant if he misses this hearing.
His appearance follows last week’s ruling that the company was guilty of contravening the provisions of the Consumer Protection Act by conducting a “mock auction” by using a ghost bidder to drive up the sale price.
The judgment by the commissioner, Mamodupi Mohlala, stems from a complaint lodged by billionaire businesswoman Wendy Appelbaum, who disputed the auction process, saying she was the only genuine bidder and had effectively bid against herself.
Levitt has not yet appeared before the commission which also found omissions and factual inaccuracies in Levitt’s defence documents.
When announcing the ruling, Mohlala said the commission would ask that Auction Alliance pay an administrative fine of 10 percent of its annual turnover. Last year the company recorded a turnover of R300 million.
Levitt could also face a 12- month prison term. If the commission finds that Levitt’s actions at the auction amounted to fraud, the case will be referred to the National Prosecuting Authority.
Levitt could not be reached yesterday but Peter Moyo, the black economic empowerment partner of Auction Alliance, said last week that Levitt was in Israel and was due to return this week.
This weekend Levitt was reportedly in the US.
Based on a 13-year paper trail in the possession of Independent Newspapers, senior bank staff, liquidators and lawyers were allegedly paid to give business to Auction Alliance.
Pending the investigations into the company, banks have ceased business dealings with Auction Alliance.
The Estate Agency Affairs Board (EAAB) is also investigating the claims while the commission said it would ask the board to investigate the prospect of suspending, with the intention to fully withdraw, Auction Alliance’s fidelity fund certificate to practise.
Cape Times