An as yet unnamed official at The Buccaneers is presently facing the axe for allegedly being paid R56 000 to convince Mokoena not to renew his contract with the team.
Speaking in an interview with KickOff.com, Palacios says people are just speculating because they want to discredit him.
"I would not be surprised if they said Augusto Palacios is involved in drugs or is gay," he says. "These people just want to destroy me. I am aware of the case at Pirates, but I’m not involved in the matter.
“I can't talk to a player about their contracts with the team. Once a player has graduated from the development side to the senior team, I have nothing to do with the player except when asked by the coach from the senior team to help with training or some other aspect of the game."
Palacios has also dismissed reports that he was involved in the firing of Ernest 'Botsotso' Makhanya and Jonny 'Black Sunday' Masegela from Pirates’ development side.
"I say it again, people will make up stories so they can destroy me. I am not responsible for the hiring or firing of coaches at Pirates.
Every coach hired at development level is under contract and if the contracts expire, it is the duty of management to deal with extending those contracts, not me.
“Anyway, I understand that Botsotso resigned from Pirates and was not fired.”