Cape Town - Lawyer Taswell Papier has
been appointed administrator of the Estate Agency Affairs Board
(EAAB), Human Settlements Minister Tokyo Sexwale said on Thursday.
Briefing journalists in Parliament,
Sexwale said the need for an administrator was urgent following a
"series of disturbing events" which had affected the estate
These included the Wendy Machanik saga,
the acrimonious departure of the EAAB's CEO Nomonde Mapetla, and the
Auction Alliance debacle.
Sexwale said it was unclear how deep
the rot was, and the administrator and Special Investigating Unit
(SIU) would separately help determine the extent of wrongdoing in the
"There's a stench here. How far
does it go back, I don't know."
The minister said he was initially in
no hurry to jump in and get involved. But the suspensions and
resignations at the board forced his hand. Last month Sexwale
announced the dissolution of the board and the appointment of a
Special Investigating Unit team.
"I don't want to at this stage
speculate how deep things have gone wrong. But, I heard from
stakeholders in the industry about the fidelity fund... there's been
some suspicious things. I heard about the handshake given to the
previous CEO," Sexwale said.
Mapetla was given a R3 million rand
golden handshake after she was suspended. Her contract was later
terminated. Suspected fraud in the industry's fidelity fund was also
Estate agencies and agents were
expected to contribute to the fidelity fund, used to guard against
theft or fraud by attorneys and agencies. The size of the fund was
unknown. It was established in the late 1970s.
Estate agent Machanik and her chief
financial officer, Bruce Bernstein, were arrested last year. They
face charges of conspiracy to commit fraud, failure to keep
accounting records, and failure to reflect over 100 transfers between
the company's trust and business accounts. The amount involved was
about R28m. The matter would be back in court in October.
Papier, former president of the Law
Society of the Cape of Good Hope, would now essentially perform the
functions of both the board and CEO for a six-month term.
"He is expected to implement
appropriate turn-around strategies... implement (a) financial control
system... provide strategic leadership and capability to the
organisation to restore its reputation, ensure sustainability and
organisational efficiency, and implement the organisational strategic
business plan as well as monitoring its performance," Sexwale
The SIU would hold a separate inquiry.
The minister did not rule out involving
the police should there be resistance to the administrator, or if
EAAB staff refused to hand over, or shredded, certain documents.
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