Watchdog to clamp down on rogue auctioneers

THE Government has agreed to clamp down on rogue auctioneering practices through a new industry watchdog with extensive powers of investigation and sanction.

The new €3 million regulator, to be funded by auctioneer licence fees, will be responsible for licensing all auctioneers and policing a stringent set of guidelines.

The move follows a year-long consultation process by the Government’s Auctioneering/Estate Agency Review Group, which yesterday published 42 recommendations aimed at addressing identified concerns.

Those concerns include problems such as gazumping, unrealistic guide prices, inaccurate property information and perceptions that “phantom bidders” are employed to force buyers to raise their bids.

Until now, the industry has been entirely self-regulated, while licences to practice involved the lodgement of a €12,700 High Court bond and an easily-obtained certificate from the District Court.

However, the regulator will assume responsibility for issuing licences and will have considerable powers of sanction against auctioneers found to be acting unfairly.

Announcing his intention to begin establishing an interim regulator immediately, Justice Minister Michael McDowell promised an initial €250,000 after which licensing fees will fund the new Navan-based State body.

Mr McDowell said the regulator would serve to protect the consumer “against a background of a considerable level of public concern about certain selling practices in the market and apparent deficiencies in regulatory and supervisory arrangements”.

He also promised that legislation to mandate the role and powers of the new regulator would be published shortly.

That legislation will likely encompass many of the recommendations of yesterday’s review which concluded that auctioneers found to be acting unfairly should be refused a license renewal and face the possibility of being named and shamed.

The powerful agency should also have considerable powers of investigation, including the ability to access premises as well as access to files and bank accounts.

In addition, agency investigators will be able to summon owners, employees, accountants and former staff as well as any relevant consultants.

Welcoming the new regulator, Institute of Professional Auctioneers and Valuers (IPAV) chief executive Liam O’Donnell said there was a clear need to regulate those auctioneers who were not members of “an established institute”.

Irish Auctioneers and Valuers Institute (IAVI) chief executive Alan McCarthy also welcomed the new regulator, saying it would bring the standards of the entire industry “closer to that of the IAVI which has set the standard in the profession for decades”.