Fraud accusation hammers Turners Auctions

Shares in Turners Auctions dropped 3 per cent to a record low today after a potential fraud by a former employee of least $1 million was revealed late yesterday.

The Serious Fraud Office is investigating.

Chairman Michael Dossor said the employee had worked for the company for a number of years, but he could not give further details.

"It would appear that the amount involved is in excess of $1 million.

"Because the matter still requires considerable investigation and is otherwise sub judice I am unable to comment any further at this time," Mr Dossor said in speech notes for the annual meeting.

"We are currently working through this problem with the SFO and our insurers."

The shares dropped four cents to $1.31 on light trading in early business on the sharemarket today. The stock has dropped 43 per cent from a year ago and 74 per cent from two years ago when it was trading at $5.20.

The company has been hit hard by competition from online auction house Trade Me.

Turners Auctions said first quarter earnings were down 59 per cent on last year. Its full year profit in 2006 fell 37 per cent to $3.2m.

The company was focusing this year on increasing volumes and the number of bidders, and improving buyer conversion rates.

- NZPA