The debate over whether Independent Newspapers received a kickback from Auction Alliance as part of a property auction last year left the media as quickly as it entered it.

2oceansvibe Media had a read of an incredibly spicy Noseweek article that was published late last month.

The highly acclaimed investigative journalism publication alleged in the article that Independent Newspapers hid a story from publication, because Auction Alliance had leverage over them, due to a kickback they (Argus – Independent Newspapers) had received.

That amount was said to be in excess of R1 million, and from court documents 2oceansvibe Media received anonymously after running our story, Rael Levitt, the now-redundant CEO of Auction Alliance, said under oath, that the amount had been paid to Independent Newspapers for a parking garage on Bree Street, Cape Town, and Newspaper House, also in Cape Town.

This was done after Auction Alliance conducted an auction to sell the aforementioned properties.

This is what Rael Levitt said in those court papers that got Noseweek thinking:

To that end, Independent Newspapers furnished 2oceansvibe Media with the following explanation as part of a lawyers letter:

 18.1 During 2011, Independent Newspapers sold two properties, one of which was sold at auction via Auction Alliance’s services as auctioneer.

18.2 Independent Newspapers negotiated with Auction Alliance, and secured agreement that it (Auction Alliance) would receive a 5% commission only of the gross purchase price paid by the Purchaser.

18.3 Auction Alliance said that they would charge the usual 10% auctioneer’s commission (to which buyers at auctions are accustomed) with the gross proceeds to be paid to Independent Newspapers less 5% commission retained by Auction Alliance. To suggest that any person in the management of Independent Newspapers received money is, with respect, untrue and reckless. This transaction was fully and properly accounted for in the company’s books as part of the final sale proceeds.

So in other words, money was received, for a discount. Normally, a discount is just that – a discount. No monies are generally paid for a discount, because you already got a deal.

The problem though, is that Noseweek alleged that top executives at Independent Newspapers had received monies. But according to Independent, that is just not true.

The other problem is that the buyers of said properties might feel a little hard done by, now knowing that they basically paid Independent Newspapers on behalf of Auction Alliance.

Independent furnished 2oceansvibe Media with this statement yesterday:

Media statement from Independent Newspapers

The July edition of  Noseweek magazine (153) contains an article headlined: “Independent News bosses struck secret deal with Auction Alliance”. It is based on a fundamentally flawed  view of events which took place when Auction Alliance sought to interdict the company’s newspapers from publishing an article containing serious allegations against the auction house.

The noseweek article suggested that Independent Newspapers management had received a kickback amounting to  “R1-m plus” from Auction Alliance, which sold two buildings in Cape Town for the company. It also claimed that certain information had emerged about Auction Alliance’s attorneys which Independent Newspapers was aware of.

The “secret deal” of the headline was an alleged agreement that both parties would suppress compromising information about each other. This, it claimed, was arranged via two mechanisms: first that the parties “agreed” that the court papers would be sealed, and second that the terms of a settlement on the interdict (which Auction Alliance withdrew) would be confidential.

The article claimed that the “deal” was concluded in order to hide certain information about Auction Alliance’s attorneys and to allegedly protect Independent Newspapers from scrutiny about the “kickback”.

This is a grossly misleading depiction of events. No such deal was struck or even contemplated.

It is untrue the court papers were sealed. An out-of-court-settlement was reached which allowed Independent Newspapers to proceed with a damaging expose’ on Auction Alliance.

To suggest that any person in the management of Independent Newspapers received money is, untrue and reckless. This transaction was fully and properly accounted for in the company’s books as part of the final sale proceeds.

With reference to information about the attorneys of Auction Alliance, copies of these papers were attached to the answering affidavits filed on behalf of Independent Newspapers. These allegations remain in the public domain, for anyone to read or publish.

It is telling that none of the Independent Newspapers executives named in the article – nor any others – were contacted for comment, information, corroboration or response by Noseweek.

The articles which various Independent Newspapers’ titles published subsequent to Auction Alliance’s attempt to gag them have cost the company many millions of rand in advertising revenue which it would have received from the auction house. It is also telling that  Noseweek did not feel it necessary to reflect this.

Independent Newspapers’ attorney Jacques Louw [recently] communicated the facts to the editor of Noseweek, Martin Welz. The company is now considering its options.

And to think, this all came to light because Levitt didn’t want Independent Newspapers to publish critical information about the company and its dealings back in February.

If you need to catch up on the latest about Auction Alliance, click HERE.

[Source: 2oceansvibe]