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The curious case of Auction Alliance

Following two seemingly botched investigations led by two separate state departments, the remnants of embattled Auction Alliance (AA) has become subject to a third probe.

On Tuesday last week the Anti-Corruption Task Team – a multi-department specialist unit made up of members of the Hawks, the Special Investigation Unit, the South African Revenue Service and the National Prosecuting Authority – launched a nationwide search and seizure operation of 13 AA properties.

According to the unit’s spokesperson, McIntosh Polela, the raid forms part of a wider investigation, still in its “early stages,” into allegations of bid-rigging and kickbacks linked to the attempted auction of the Quion Rock wine estate in December last year.

As there was no prior indication that the task team was investigating Auction Alliance, which by then appeared to have escaped the legislative hook, the raid took everyone by surprise.  
But while the task team’s forensic investigation may benefit from the element of surprise, the timing of its raid is, at the least, curious.

This is because there is not much left of AA – even the signage has been taken off the Johannesburg headquarters.

In addition, the raids come almost six months after initial allegations of fraud and misconduct.
While Levitt’s attorneys are contesting the warrants used by the unit last week, stating that they are illegal with any documents or information seized not likely to be admissible in court, it is a matter of speculation as to how much pertinent data the unit would have been able to seize by this point.

“To be putting it quite simply, the quicker you work on something the better … timing is everything,” says Cindy Nichols, a director at Pasco Risk Management.

Nichols was a lead investigator on the charges brought against property guru Wendy Machanik.
Not speaking directly in connection with the AA investigation, she notes that “the moment we are assigned a case we immediately act, we don’t wait … we will go in immediately.

“The more time a suspect has to know that you are coming, the longer he has to protect himself and erode any form of evidence you may find … he knows where he has his evidence and he has got to find a way to hide it.”

According to Nichols, SA’s elite investigative units suffer from severe under capacity with investigators sitting with as many as 90 open investigations at a time.

This results in an inability to act swiftly she says and undermines state ability to properly investigate complex cases.

The anti-corruption task team was, however, unwilling to elaborate on the timeliness of its investigation.

“The investigations has been taking place for some time,” said Dennis Adriao, SAPS spokesperson. “This raid was part of a long standing investigation.”

On the contested warrants, Adriao would only say that it is “something they [AA] will have to take up with the courts”.

The legality of the warrants is expected to be tested in court this week says AA attorney, Dale Smeidt.

(Moneyweb)


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