Commission warns Auction Alliance boss

19 April 2012 - 02:28 By KATHARINE CHILD
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Auction Alliance founder Rael Levitt might be arrested if he fails to appear at a National Consumer Commission hearing on May 4, according to the commission's senior researcher, David Railo.

RAEL LEVITT
RAEL LEVITT
RAEL LEVITT
RAEL LEVITT

A summons was issued for Levitt to attend, said Railo, after he failed to appear at the last four hearings. The commission's previous application to a Pretoria magistrate for a warrant of arrest for Levitt was unsuccessful because the summons had not been correctly issued.

The commission is sitting to determine whether Levitt committed fraud and if the investigation should be handed over to the National Prosecuting Authority.

Railo told journalists in Johannesburg yesterday that the National Consumer Commission "doesn't know where Levitt is".

Levitt told the Sunday Times last week that he has been in Israel and the US but would return soon.

The commission last month found Levitt and Auction Alliance guilty of breaching the Consumer Protection Act by using a "ghost bidder" to drive up the price of Quoin Rock estate at a December auction.

Wendy Appelbaum, who bid for the estate, complained to the commission in January that she bid against ghost bidder Deon Leygonie. Leygonie was employed by Auction Alliance.

A R1-million fine was imposed on Levitt for breaching the Consumer Protection Act but he has not paid the fine said Railo. Auction Alliance was fined 10% of its annual turnover, which has also not been paid.

Railo said more complaints against Auction Alliance were being submitted to the commission.

Yesterday, the SA Institute of Auctioneers rejected Levitt's claims that ghost bidding is the "norm in the South African auction industry and across the world".

Levitt told the Sunday Times: "Ghost bidding happens every day, in every way in every auction across the globe."

But the institute challenged Levitt to "name any other auctioneer or auction company practising ghost bidding".

The auctioneers institute's chairman, Tirhani Mabunda, said that, though ghost bidding was not entrenched, "corruption and kickbacks" were present in the auctioning industry and better regulation of the industry was needed.

He hoped a code proposed by national consumer commissioner Mamodupi Mohlala would become law to "prescribe minimum standards of qualification, licensing, ethics and professionalism for auctioneers".

Deputy institute chairman John Cowing said the institute had been campaigning for regulation of the industry for at least the last six years.

Lawyers acting for Levitt had not responded to questions at the time of going to press.

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