Estate Agency Affairs Board has been placed under administration

The embattled Estate Agency Affairs Board( EAAB) has been placed under administration, Human Settlements Minister Tokyo Sexwale said yesterday.

“I am compelled in the interests of bringing certainty and order to put [the board] under administration,” Sexwale said in Johannesburg.

The decision came into effect on Monday.

He called for the Special Investigating Unit to probe wrongdoing in the affairs of the EAAB and to lay criminal charges if necessary.

“I’ve also decided the Special Investigating Unit must step in. They must bring in a very strong broom to clean up this mess.”

At the same time, his department would conduct due diligence into the EAAB “to understand what we are inheriting”.

Sexwale was addressing estate agents, after his department took over the EAAB in May. This regulatory body for the real estate industry previously fell under the authority of the department of trade and industry.

“You are spoiling the industry, you are making headlines for all the wrong reasons,” Sexwale told them.

An administrator would be appointed within days.

Speaking to media after his address, Sexwale said he had been aware of problems at the EAAB including alleged corruption, abuse of funds, maladministration and embezzlement.

However, he was forced into taking action when the board’s chairwoman, Ina Wilken, resigned this month shortly after taking up the position.

He had met Wilken to find out why she had resigned and she told him –which he did not want to disclose — what the “tilting point” was.

“She is dissatisfied about certain issues around governance,” Sexwale said.

The EAAB has had three acting CEOs since Nomonde Mapetla was suspended, before her contract ended early last year.

Before Wilken, acting CEO Bryan Chaplog was removed by the board. The board said this was part of a rotation of the position.

Last year, chairman Thami Bolani was suspended by Trade and Industry Minister Rob Davies after allegations that a company of which Bolani was chairman pocketed R200,000 from the EAAB.

Sexwale yesterday dissolved the board, saying it was dysfunctional.

“To date when a board is supposed to be having 15 members, they are left with three.”

Sexwale said he was particularly interested in hearing from the EAAB’s suspended company secretary Nkululeko Ndebele.

He also raised concerns about Wendy Machanik, Auction Alliance and the board’s fidelity fund.

“People must gain assurances that that fund is properly used… in the interests of the sector,” he said.

Machanik, the close corporation Wendy Machanik Property Holdings, and its chief financial officer Bruce Bernstein have been charged with conspiracy to commit fraud, among other things.

Businesswoman Wendy Appelbaum alleged that Auction Alliance had used a ghost bidder when she bought Cape winelands estate, Quoin Rock, for R55 million in December last year.

Sexwale said he hoped the board issues would be dealt with quickly to ensure investor confidence, as it was a sector “very critical to the economy”.

“It’s important that we bring certainty back as quickly as possible.”

Sexwale will hold a summit with estate agents in September.

He called on anyone with knowledge of what was going on at the EAAB to inform his department.