The Special Investigating Device has identified five accounting corporations that aided loot Lottery money. Graphic: Lisa Nelson
The Specific Investigating Unit has recognized five accounting and auditing corporations that aided non-income firms loot Lottery money supposed for “superior results in”.
The accounting companies compiled fraudulent economical statements utilized by these businesses to make an application for Lottery funding, the SIU advised Parliament.
Acting chief countrywide investigations officer Zodwa Xesibe reported the SIU would acquire motion to get these companies blacklisted.
A four-year probe from the ruay Particular Investigating Unit (SIU) has uncovered five accounting and auditing corporations that assisted dodgy non-profit companies loot hundreds of millions of rands designed for “very good triggers” within the Lottery.
These firms were described via the SIU as “Expert enablers,” who “compiled fraudulent financial statements” that were utilized by the businesses to submit an application for Lottery funding.
The 5 businesses had been named in Parliament from the SIU’s performing Main nationwide investigations officer Zodwa Xesibe. They can be TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Companies.
Fraudulent financials produced by these five accounting firms served approximately 40 businesses get their arms on lottery funding, in accordance with the SIU presentation.
Based upon a Resource made up of information with all lottery grants considering that 2002, these companies acquired over R314-million in funding.
“These NPCs were funded via the Countrywide Lotteries Fee (NLC) nevertheless the resources weren't made use of for his or her intended goal,” Xesibe instructed Parliament’s Trade, Sector and Competitors Portfolio Committee final 7 days.
The SIU, the Hawks as well as the National Prosecuting Authority (NPA) were being in Parliament to report to the committee on development in bringing folks and organisations associated with looting the lottery to e-book.
Xesibe told GroundUp the SIU intended to lodge issues towards the accounting corporations involved and was checking if these companies were being registered and, In that case, with which Experienced bodies.
“We want these organizations being blacklisted,” she explained to GroundUp.
To qualify for Lottery funding, an organisation was necessary to make two yrs of once-a-year money statements, Xesibe spelled out in Parliament.
Having said that, as an ongoing six-12 months investigation into lottery corruption by GroundUp has unveiled, hijacked non-earnings organisations (NPOs) or new shelf non-earnings companies (NPCs) without having fiscal keep track of data ended up used to submit an application for funding.
In some scenarios, Practically equivalent financial statements were developed for unrelated organisations, normally with just the names from the organisations modified, GroundUp’s investigation identified.
Paperwork submitted by real NPCs for unsuccessful grant apps have been typically used by new or hijacked NPCs and NPOs to submit an application for funding. The main points and paperwork on the unsuccessful applicants have been equipped by senior Lottery officers for the dodgy applicants.
With cursory or - usually - no verification, these dodgy applicants were awarded millions of rands in grants. Sometimes more tranches of funds were being paid out without much checking to the development of tasks.
The vast majority of such grants have been produced by means of proactive funding, which was at the guts of your looting from the lottery. Proactive funding permitted the Minister of Trade, Business and Competitors, or perhaps the NLC along side its board, to determine brings about to fund with out initially demanding an software. This was stopped whenever a new NLC board was appointed.
R2-billion in grants beneath investigation
SIU head Advocate Andy Mothibi stated the SIU was presently investigating grants valued at in excess of R2-billion, along with the unit was even now often obtaining tip-offs about more corruption.
He explained to MPs that the SIU’s investigation were damaged into three phases: the very first, that has been finalised, probed dodgy grants amounting to R280-million, and the next, also finished, included R247-million. During the 3rd section, as a result of be finalised at the end of the year, the SIU is investigating grants valued at Practically R906-million, involving 40 NPOs and NPCs, Mothibi mentioned.
He stated which the SIU would implement “quickly” for the Presidential Proclamation, at first granted in Oct 2020 to investigate corruption involving lottery grants, to become prolonged to include procurement because of the NLC.
The SIU investigation experienced so far brought about thirteen disciplinary referrals for the NLC, and administrative referrals to SARS and the businesses and Intellectual Attributes Commission to blacklist people today implicated inside the looting. Problems involving two individuals had been referred on the Lawful Apply Council along with the SA Institute of Chartered Accountants.
The SIU experienced noticed various traits underneath the past NLC board and government - a lot of whom are actually implicated in looting - Mothibi told MPs.
This incorporated a “pattern of collusion among NLC officers and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “normal maladministration from the approval of grants,” he reported.
Slow development with the NPA
The SIU has frozen houses, Attributes, automobiles along with other belongings well worth tens of millions that were acquired with lottery money, but MPs expressed issue at gradual development in prosecuting People involved with the looting. (The SIU is mandated only to Get better belongings acquired with stolen condition cash and does not have prosecuting powers).
While the SIU has referred 15 issues into the NPA, to this point only two folks have been introduced ahead of a courtroom. Two Adult males appeared in court docket in Kimberley not long ago in connection with misappropriated funds gathered for just a project to battle gender-based violence.
In August 2022 Christopher Tshivule was sentenced to eight years in prison for his part in the R1.five-million lottery grant fraud. Fees against two men and women billed with him, who the SIU has described as “kingpins” from the corruption that overwhelmed the NLC, ended up dropped.
Significant-Typical Mmeli Makinyane, the performing divisional commissioner for precedence offences, told MPs the Hawks have been currently investigating 16 lottery corruption-linked conditions. Another one - the Kimberley make a difference - is just before a court and two are despatched into the NPA for a call to prosecute. An additional 5 cases are being investigated via the SAPS detective and forensic services, he reported.
Outlining the reasons for that delay in prosecutions, NPA Deputy National Director Rodney de Kock claimed Component of The explanation was which the Hawks had to do further investigations when they gained dossiers in the SIU.
“In essence, the investigations undertaken with the SIU will not fulfill felony specifications for prosecutions.”
For that reason, the NPA had to work with investigators from the DPCI (the Hawks) and SAPS to carry out felony investigations and ensure that the proof fulfills prison prosecution requirements, he stated, adding: “Having said that, the work of the SIU is important and contributes greatly to this method.”
De Kock claimed that the SIU’s investigation “normally leads to a number of referrals. The referrals might ultimately cause one docket and just one court docket situation.”
He claimed that twelve matters, which are “around eighty five% entire”, had been staying jointly investigated because of the Hawks and also the SIU’s Specialised Economic Functions Unit. (These types of cases, seven of which were lodged in 2020, involve former NLC chief running officer Phillemon Letwaba, who resigned below a cloud in 2022, and Pretoria attorney Leslie Ramulifho.)
De Kock said the NPA confronted quite a few “problems” in prosecuting cases. These, he explained, included
the lapse of time in between once the offences ended up dedicated as well as issuing in the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary evidence” (Earlier this yr, the SIU advised the committee that critical paperwork necessary in some prosecutions were deleted within the NLC computer procedure or experienced gone lacking from Metrofile, a warehouse wherever copies of paperwork are archived and saved);
The reality that some implicated people remain employed by NLC; and
A problem to the legality on the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is committed to making certain finalisation in these matters. To this close, a group of devoted prosecutors has long been allocated to supervise all NLC issues presently beneath investigation,” de Kock reported. “Issues are handled as being a priority. As soon as [the] investigations are finished, the NPA will make a call.”
What the businesses say (or don’t)
GroundUp was only ready to get remark from on the list of 5 firms accused through the SIU in Parliament of producing fraudulent yearly economic statements,TTP Consulting.
Aubrey Moeng, among TTP’s two administrators, mentioned within an e-mail in reaction to concerns: “As a consequence of client confidentiality, we prefer to advise that TTP Consulting will not be prepared to disclose clientele’ economical private data with the general public or media … with no consent from the consumer or maybe a authorized motive.”
The company is really a “spouse” of many condition entities, which includes SARS as well as the CIPC, In keeping with its Web-site.
Neither of The 2 administrators of Dzata Accountants, who're both listed as inactive to the CIPC register of companies, responded to emailed inquiries. The company has actually been deregistered from the CIPC for failing to submit money statements because 2021.
The only director of Mageba Ntuli Investing and Consulting Service, Patrick Zulu, died 3 decades back, Based on official information. The corporate was deregistered via the CIPC for failing to post economical statements since 2021.
Matamela Magodi, the sole director of Magodi Consultants, didn't reply to concerns emailed to him.
GroundUp was struggling to find any listing for Tafta Consulting and Accounting Services Using the CIPC. We were being also not able to trace any of the organization’s administrators to ask for comment.