The ACT Integrity Commission has cleared the Suburban Land Agency (SLA) of any suspicion of corruption around its ‘book-to-buy’ process for the sale of residential lots.
It has uncovered potential corruption risks however.
In his Special Report – Suburban Land Agency Land Sales, Integrity Commissioner Michael Adams said SLA notified the Commission following a small number of complaints about its book-to-buy process for residential lots in Throsby and Whitlam.
“This process required a potential buyer to complete an online registration for the opportunity to be allocated a block of land to purchase,” Commissioner Adams said.
“The complaints broadly alleged that the process was ‘rigged’ to give an advantage to certain registered applicants,” he said.
“Although the Commission has determined that no reasonable suspicion of corruption arises, examination of the issues raised by the complaints has identified several significant matters that are potential corruption risks which the SLA needs to address.”
Commissioner Adams said the complaints did not warrant investigation because the evidence did not raise the reasonable suspicion that SLA or the Sales Agent was involved.
He said this held true even in accepting that successful book-to-buy registrants had acted improperly.
“In essence, there was no basis for a reasonable suspicion that the registration system was rigged to give any advantage to the successful registrants, who were free to negotiate with third parties if they wished to do so,” the Commissioner said.
“Nevertheless, it seems clear that gaming by bidders of the book-to-buy system as it was configured is a real risk to the integrity of the process.”
He said despite safeguards to ensure the widest number of purchasers were able to participate in the process, “any number of registrants could be acting as agents for a third party and, thus, enable that undisclosed third party to bypass the requirement.”
“There are reasonable grounds for thinking it likely that this may have happened in relation to the Throsby land release and thus undermined its integrity, with adverse consequences for those participants who had acted in good faith, and for the reputation of the process,” Commissioner Adams said.
He said the book-to-buy process was examined and significantly altered to ensure duplicate or related parties could not register and that the registration names could not be substituted on sale contracts.
The Commission’s 17-page Report can be accessed at this PS News link.
