The accountants who helped loot the Lottery
The accountants who helped loot the Lottery
Blog Article
The Exclusive Investigating Device has recognized five accounting corporations that helped loot Lottery cash. Graphic: Lisa Nelson
The Special Investigating Device has discovered five accounting and auditing companies that assisted non-financial gain organizations loot Lottery dollars meant for “excellent brings about”.
The accounting companies compiled fraudulent money statements utilized by these corporations to make an application for Lottery funding, the SIU advised Parliament.
Acting Main nationwide investigations officer Zodwa Xesibe said the SIU would consider action to acquire these corporations blacklisted.
A 4-year probe via the hihuay Distinctive Investigating Unit (SIU) has exposed 5 accounting and auditing corporations that served dodgy non-profit businesses loot numerous numerous rands meant for “great causes” with the Lottery.
These companies have been described with the SIU as “Skilled enablers,” who “compiled fraudulent financial statements” which were used by the companies to submit an application for Lottery funding.
The five providers were being named in Parliament by the SIU’s acting Main nationwide investigations officer Zodwa Xesibe. They are really 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 40 organizations get their hands on lottery funding, according to the SIU presentation.
According to a Resource that contains information with all lottery grants because 2002, these companies obtained above R314-million in funding.
“These NPCs were funded through the Countrywide Lotteries Commission (NLC) though the funds were not utilised for their intended objective,” Xesibe told Parliament’s Trade, Field and Competition Portfolio Committee last week.
The SIU, the Hawks along with the Countrywide Prosecuting Authority (NPA) ended up in Parliament to report to the committee on development in bringing individuals and organisations involved in looting the lottery to e book.
Xesibe instructed GroundUp that the SIU intended to lodge grievances towards the accounting firms associated and was checking if these corporations were being registered and, If that's the case, with which Expert bodies.
“We want these providers being blacklisted,” she informed GroundUp.
To qualify for Lottery funding, an organisation was necessary to deliver two yrs of annual money statements, Xesibe defined in Parliament.
Having said that, being an ongoing 6-calendar year investigation into lottery corruption by GroundUp has exposed, hijacked non-earnings organisations (NPOs) or new shelf non-earnings organizations (NPCs) without any monetary observe information have been used to apply for funding.
In certain scenarios, almost similar financial statements have been created for unrelated organisations, normally with just the names from the organisations adjusted, GroundUp’s investigation discovered.
Paperwork submitted by legitimate NPCs for unsuccessful grant applications had been usually utilized by new or hijacked NPCs and NPOs to submit an application for funding. The main points and documents of the unsuccessful applicants were equipped by senior Lottery officers on the dodgy applicants.
With cursory or - generally - no verification, these dodgy applicants have been awarded numerous rands in grants. Sometimes more tranches of money were being paid out out with out A great deal examining around the progress of initiatives.
The vast majority of those grants were made by means of proactive funding, which was at the guts with the looting of the lottery. Proactive funding allowed the Minister of Trade, Market and Competitiveness, or perhaps the NLC along side its board, to detect triggers to fund devoid of to start with demanding an application. This was stopped when a new NLC board was appointed.
R2-billion in grants less than investigation
SIU head Advocate Andy Mothibi said the SIU was currently investigating grants valued at over R2-billion, and the device was nonetheless regularly obtaining tip-offs about additional corruption.
He told MPs the SIU’s investigation were damaged into three phases: the main, which has been finalised, probed dodgy grants amounting to R280-million, and the next, also done, concerned R247-million. In the third section, resulting from be finalised at the end of the yr, the SIU is investigating grants valued at Practically R906-million, involving 40 NPOs and NPCs, Mothibi explained.
He reported that the SIU would use “quickly” for that Presidential Proclamation, initially granted in Oct 2020 to analyze corruption involving lottery grants, to be prolonged to include procurement through the NLC.
The SIU investigation had thus far resulted in 13 disciplinary referrals to the NLC, and administrative referrals to SARS and the businesses and Mental Properties Commission to blacklist people implicated while in the looting. Problems involving two men and women were referred on the Legal Follow Council and the SA Institute of Chartered Accountants.
The SIU experienced noticed many tendencies underneath the previous NLC board and executive - a lot of whom happen to be implicated in looting - Mothibi instructed MPs.
This included a “trend of collusion in between NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “basic maladministration from the approval of grants,” he mentioned.
Sluggish progress through the NPA
The SIU has frozen houses, properties, cars as well as other belongings value tens of millions which were bought with lottery money, but MPs expressed issue at sluggish progress in prosecuting Those people linked to the looting. (The SIU is mandated only to Recuperate belongings purchased with stolen condition cash and doesn't have prosecuting powers).
Although the SIU has referred 15 matters towards the NPA, to date only two individuals have been brought ahead of a court. Two Gentlemen appeared in courtroom in Kimberley a short while ago in reference to misappropriated money collected for just a job to fight gender-centered violence.
In August 2022 Christopher Tshivule was sentenced to eight decades in prison for his section in the R1.5-million lottery grant fraud. Prices against two people today charged with him, who the SIU has referred to as “kingpins” in the corruption that overwhelmed the NLC, have been dropped.
Big-Typical Mmeli Makinyane, the performing divisional commissioner for precedence offences, told MPs that the Hawks had been at this time investigating 16 lottery corruption-connected situations. One more one particular - the Kimberley make a difference - is prior to a court docket and two are sent into the NPA for a choice to prosecute. An extra five conditions are now being investigated by the SAPS detective and forensic products and services, he mentioned.
Conveying The explanations to the hold off in prosecutions, NPA Deputy Countrywide Director Rodney de Kock stated Portion of the reason was that the Hawks had to do more investigations whenever they been given dossiers in the SIU.
“In essence, the investigations undertaken from the SIU usually do not satisfy criminal requirements for prosecutions.”
Consequently, the NPA experienced to work with investigators inside the DPCI (the Hawks) and SAPS to conduct felony investigations and be certain that the evidence satisfies felony prosecution specifications, he reported, including: “Having said that, the perform of your SIU is significant and contributes tremendously to this process.”
De Kock claimed that the SIU’s investigation “usually ends in various referrals. The referrals might eventually bring about a person docket and 1 court situation.”
He mentioned that 12 issues, which are “approximately eighty five% comprehensive”, have been becoming jointly investigated from the Hawks as well as the SIU’s Specialised Financial Operations Device. (These types of instances, seven of which were lodged in 2020, require previous NLC chief working officer Phillemon Letwaba, who resigned less than a cloud in 2022, and Pretoria lawyer Leslie Ramulifho.)
De Kock mentioned the NPA confronted quite a few “problems” in prosecuting cases. These, he explained, involved
the lapse of your time between if the offences ended up fully commited as well as issuing of your Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary proof” (Previously this 12 months, the SIU advised the committee that crucial documents required in some prosecutions were deleted with the NLC Laptop or computer procedure or had gone lacking from Metrofile, a warehouse wherever copies of documents are archived and saved);
The reality that some implicated folks remain employed by NLC; and
A challenge into the legality in the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is committed to guaranteeing finalisation in these matters. To this conclusion, a team of committed prosecutors has been allocated to supervise all NLC issues at present less than investigation,” de Kock said. “Matters are handled as being a priority. After [the] investigations are concluded, the NPA could make a choice.”
What the companies say (or don’t)
GroundUp was only ready to get remark from one of many five businesses accused with the SIU in Parliament of producing fraudulent once-a-year money statements,TTP Consulting.
Aubrey Moeng, amongst TTP’s two administrators, mentioned within an e-mail in reaction to queries: “Due to customer confidentiality, we want to suggest that TTP Consulting isn't ready to disclose customers’ money private information and facts with the general public or media … with no consent from the client or simply a lawful rationale.”
The company is a “companion” of a number of state entities, including SARS and also the CIPC, In accordance with its Web site.
Neither of The 2 directors of Dzata Accountants, who will be both equally shown as inactive about the CIPC register of providers, responded to emailed issues. The business has been deregistered with the CIPC for failing to post monetary statements considering the fact that 2021.
The sole director of Mageba Ntuli Buying and selling and Consulting Company, Patrick Zulu, died three a long time ago, As outlined by Formal documents. The corporation was deregistered from the CIPC for failing to submit fiscal statements due to the fact 2021.
Matamela Magodi, the only director of Magodi Consultants, did not reply to issues emailed to him.
GroundUp was not able to uncover any listing for Tafta Consulting and Accounting Providers Using the CIPC. We were being also unable to trace any of the corporation’s directors to ask for remark.