Madeleine Nirere, the Ombudsperson, has expressed deep concerns over the significant devaluation of assets during public auctions. Speaking to members of the Parliamentary Committee on Governance, Gender, and Social Inclusion, she revealed findings from a recent report showing that auctions often lead to assets being sold at shockingly low prices, causing financial losses and impoverishment for citizens.
Nirere noted that the technology introduced to address these issues has not yielded tangible results. She explained that properties are still being sold at prices far below their value, leading to losses for individuals and communities. For example, she cited a case where a house valued at RWF 30 million was sold for just RWF 3 million, raising serious concerns about fraud and manipulation in the auction process.
The Ombudsman attributed the problem to cybercrime, where individuals manipulate auction systems to set low prices. She emphasized the need for urgent reforms, suggesting that properties should not be auctioned for less than 75% of their appraised value.
During her presentation of the 2023/2024 performance report and the 2024/2025 action plan, Nirere called on relevant institutions, including the Ministry of Justice, to address the legal loopholes that allow such devaluation of assets. She urged for stricter oversight to ensure fairness in the auction process and prevent exploitation.
Hon. Nabahire Anastase, Chairperson of the Parliamentary Committee, acknowledged the existence of legal gaps but defended the technological system, stating that it has reduced the use of paper-based processes and limited the role of brokers. However, he admitted that brokers have not been entirely eliminated and stressed the government’s ongoing efforts to combat their influence.
Rwanda’s auction law requires assets to be announced and auctioned in three rounds if the reserve price is not met. However, it is during the third round that significant devaluation occurs, leading to the most losses for property owners. Nabahire advised citizens to settle their debts promptly or seek mediation to avoid auctions altogether.
The Ombudsman’s report highlights the far-reaching impact of auction malpractice, not only on individuals but also on families and financial institutions such as banks, which often bear the brunt of these losses. Both Nirere and Nabahire called for urgent action to protect citizens and ensure justice in asset auctions.