The accountants who assisted loot the Lottery
The accountants who assisted loot the Lottery
Blog Article
The Distinctive Investigating Device has discovered five accounting companies that served loot Lottery funds. Graphic: Lisa Nelson
The Specific Investigating Device has identified five accounting and auditing firms that assisted non-gain businesses loot Lottery cash meant for “excellent triggers”.
The accounting corporations compiled fraudulent monetary statements used by these companies to apply for Lottery funding, the SIU told Parliament.
Acting chief nationwide investigations officer Zodwa Xesibe stated the SIU would take action to get these companies blacklisted.
A four-calendar year probe via the hihuay Specific Investigating Device (SIU) has uncovered five accounting and auditing corporations that helped dodgy non-financial gain providers loot countless many rands meant for “superior leads to” with the Lottery.
These companies had been described by the SIU as “professional enablers,” who “compiled fraudulent economical statements” that were utilized by the businesses to submit an application for Lottery funding.
The five firms were being named in Parliament from the SIU’s acting chief national investigations officer Zodwa Xesibe. These are TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Services.
Fraudulent financials made by these 5 accounting corporations aided just about forty firms get their fingers on lottery funding, based on the SIU presentation.
Depending on a Instrument made up of details with all lottery grants considering the fact that 2002, these corporations acquired more than R314-million in funding.
“These NPCs were being funded with the Countrywide Lotteries Commission (NLC) though the money weren't used for their meant intent,” Xesibe informed Parliament’s Trade, Sector and Competitors Portfolio Committee previous 7 days.
The SIU, the Hawks as well as Countrywide Prosecuting Authority (NPA) were in Parliament to report to the committee on development in bringing people and organisations involved in looting the lottery to book.
Xesibe told GroundUp which the SIU meant to lodge grievances towards the accounting firms associated and was checking if these firms were being registered and, If that is so, with which Specialist bodies.
“We want these providers to get blacklisted,” she told GroundUp.
To qualify for Lottery funding, an organisation was needed to create two decades of annual fiscal statements, Xesibe defined in Parliament.
On the other hand, being an ongoing six-yr investigation into lottery corruption by GroundUp has discovered, hijacked non-profit organisations (NPOs) or new shelf non-earnings corporations (NPCs) without having economical keep track of documents were being utilized to submit an application for funding.
In a few occasions, Just about similar economic statements had been produced for unrelated organisations, normally with only the names from the organisations changed, GroundUp’s investigation observed.
Documents submitted by authentic NPCs for unsuccessful grant applications ended up frequently utilized by new or hijacked NPCs and NPOs to submit an application for funding. The details and paperwork of your unsuccessful applicants have been provided by senior Lottery officers to the dodgy applicants.
With cursory or - usually - no verification, these dodgy applicants ended up awarded many rands in grants. Occasionally added tranches of cash ended up paid out out devoid of Substantially checking within the progress of projects.
The overwhelming majority of those grants were made by means of proactive funding, which was at the center of the looting of your lottery. Proactive funding permitted the Minister of Trade, Industry and Level of competition, or even the NLC in conjunction with its board, to establish leads to to fund devoid of initial necessitating an application. This was stopped any time a new NLC board was appointed.
R2-billion in grants under investigation
SIU head Advocate Andy Mothibi mentioned the SIU was at this time investigating grants valued at over R2-billion, and also the unit was nonetheless routinely getting tip-offs about much more corruption.
He informed MPs that the SIU’s investigation were broken into three phases: the first, that has been finalised, probed dodgy grants amounting to R280-million, and the second, also done, included R247-million. Inside the 3rd stage, as a result of be finalised at the conclusion of the yr, the SIU is investigating grants valued at Pretty much R906-million, involving 40 NPOs and NPCs, Mothibi claimed.
He stated the SIU would utilize “quickly” for that Presidential Proclamation, at first granted in October 2020 to investigate corruption involving lottery grants, to get prolonged to incorporate procurement by the NLC.
The SIU investigation had up to now resulted in 13 disciplinary referrals for the NLC, and administrative referrals to SARS and the Companies and Intellectual Qualities Commission to blacklist individuals implicated inside the looting. Grievances involving two individuals were referred into the Authorized Apply Council as well as the SA Institute of Chartered Accountants.
The SIU experienced observed a number of traits beneath the previous NLC board and government - many of whom are actually implicated in looting - Mothibi advised MPs.
This included a “pattern of collusion concerning NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “standard maladministration during the approval of grants,” he mentioned.
Sluggish development via the NPA
The SIU has frozen homes, Qualities, automobiles and various belongings truly worth tens of millions which were acquired with lottery money, but MPs expressed problem at slow development in prosecuting All those involved with the looting. (The SIU is mandated only to recover belongings purchased with stolen state cash and does not have prosecuting powers).
Though the SIU has referred 15 issues on the NPA, up to now only two folks have been brought right before a court. Two Adult men appeared in court in Kimberley not long ago in connection with misappropriated money collected to get a challenge to battle gender-primarily based violence.
In August 2022 Christopher Tshivule was sentenced to 8 yrs in prison for his component inside of a R1.5-million lottery grant fraud. Costs versus two individuals billed with him, who the SIU has described as “kingpins” during the corruption that overcome the NLC, were dropped.
Major-Basic Mmeli Makinyane, the acting divisional commissioner for priority offences, informed MPs that the Hawks were at present investigating 16 lottery corruption-connected situations. A further one - the Kimberley matter - is before a courtroom and two are actually sent towards the NPA for a call to prosecute. An additional 5 cases are increasingly being investigated via the SAPS detective and forensic companies, he stated.
Detailing The explanations for the delay in prosecutions, NPA Deputy Nationwide Director Rodney de Kock explained Element of The main reason was the Hawks had to do even further investigations every time they been given dossiers from the SIU.
“In essence, the investigations carried out because of the SIU will not satisfy criminal standards for prosecutions.”
Hence, the NPA had to work with investigators during the DPCI (the Hawks) and SAPS to carry out prison investigations and be sure that the evidence fulfills prison prosecution expectations, he said, including: “Having said that, the work on the SIU is crucial and contributes tremendously to this process.”
De Kock explained the SIU’s investigation “generally brings about multiple referrals. The referrals might eventually cause one particular docket and one particular courtroom case.”
He stated that twelve matters, which can be “around 85% entire”, ended up getting jointly investigated from the Hawks and the SIU’s Specialised Economic Functions Device. (The majority of these cases, seven of which have been lodged in 2020, contain former NLC chief working officer Phillemon Letwaba, who resigned underneath a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)
De Kock said the NPA faced a number of “problems” in prosecuting scenarios. These, he claimed, bundled
the lapse of your time involving if the offences have been committed and also the issuing from the Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary evidence” (Earlier this calendar year, the SIU advised the committee that crucial files essential in some prosecutions were deleted in the NLC Laptop or computer technique or experienced gone missing from Metrofile, a warehouse where by copies of documents are archived and stored);
The point that some implicated people are still utilized by NLC; and
A obstacle to the legality in the Presidential Proclamation by former NLC chairperson Alfred Nevhutanda.
“The NPA is devoted to guaranteeing finalisation in these issues. To this conclusion, a workforce of focused prosecutors has been allotted to supervise all NLC issues at the moment beneath investigation,” de Kock explained. “Matters are handled to be a precedence. When [the] investigations are finished, the NPA will make a choice.”
What the companies say (or don’t)
GroundUp was only able to get comment from among the 5 businesses accused via the SIU in Parliament of producing fraudulent yearly financial statements,TTP Consulting.
Aubrey Moeng, considered one of TTP’s two administrators, mentioned within an electronic mail in reaction to concerns: “Resulting from shopper confidentiality, we want to advise that TTP Consulting is just not ready to disclose purchasers’ money private facts with the general public or media … without the consent from the client or perhaps a lawful rationale.”
The corporate can be a “associate” of a number of point out entities, like SARS as well as the CIPC, Based on its Web-site.
Neither of the two administrators of Dzata Accountants, who will be the two mentioned as inactive within the CIPC sign up of companies, responded to emailed inquiries. The corporation continues to be deregistered with the CIPC for failing to post money statements since 2021.
The sole director of Mageba Ntuli Investing and Consulting Service, Patrick Zulu, died a few decades back, As outlined by Formal information. The organization was deregistered by the CIPC for failing to post fiscal statements given that 2021.
Matamela Magodi, the sole director of Magodi Consultants, did not reply to inquiries emailed to him.
GroundUp was unable to come across any listing for Tafta Consulting and Accounting Providers with the CIPC. We have been also struggling to trace any of the organization’s administrators to request remark.