The accountants who helped loot the Lottery

The accountants who helped loot the Lottery

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The Unique Investigating Device has identified 5 accounting corporations that assisted loot Lottery cash. Graphic: Lisa Nelson

The Distinctive Investigating Device has recognized five accounting and auditing firms that served non-profit organizations loot Lottery income supposed for “fantastic brings about”.
The accounting firms compiled fraudulent economical statements used by these corporations to submit an application for Lottery funding, the SIU advised Parliament.
Performing chief national investigations officer Zodwa Xesibe stated the SIU would choose motion to possess these corporations blacklisted.
A 4-12 months probe because of the luckyvip77 Particular Investigating Unit (SIU) has exposed 5 accounting and auditing corporations that aided dodgy non-income firms loot many a lot of rands intended for “excellent leads to” from the Lottery.

These corporations ended up described through the SIU as “Qualified enablers,” who “compiled fraudulent economic statements” that were employed by the businesses to make an application for Lottery funding.

The 5 corporations had been named in Parliament via the SIU’s acting Main countrywide investigations officer Zodwa Xesibe. They can be TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Providers.

Fraudulent financials produced by these five accounting companies aided just about forty companies get their hands on lottery funding, according to the SIU presentation.

Based upon a tool containing data with all lottery grants because 2002, these businesses got over R314-million in funding.

“These NPCs were being funded because of the National Lotteries Fee (NLC) even so the funds were not made use of for their supposed objective,” Xesibe instructed Parliament’s Trade, Business and Competitors Portfolio Committee very last 7 days.

The SIU, the Hawks along with the Countrywide Prosecuting Authority (NPA) were in Parliament to report to the committee on progress in bringing persons and organisations linked to looting the lottery to guide.

Xesibe instructed GroundUp which the SIU intended to lodge complaints against the accounting firms involved and was checking if these firms have been registered and, If that's the case, with which Specialist bodies.

“We wish these businesses to generally be blacklisted,” she informed GroundUp.

To qualify for Lottery funding, an organisation was required to create two a long time of yearly economical statements, Xesibe explained in Parliament.

On the other hand, being an ongoing six-year investigation into lottery corruption by GroundUp has exposed, hijacked non-earnings organisations (NPOs) or new shelf non-income firms (NPCs) without any monetary keep track of records were being utilized to make an application for funding.

In a few circumstances, almost identical economic statements ended up made for unrelated organisations, normally with only the names of your organisations adjusted, GroundUp’s investigation found.

Files submitted by genuine NPCs for unsuccessful grant programs were typically employed by new or hijacked NPCs and NPOs to submit an application for funding. The main points and paperwork with the unsuccessful applicants had been supplied by senior Lottery officers to your dodgy applicants.

With cursory or - often - no verification, these dodgy applicants were being awarded an incredible number of rands in grants. From time to time supplemental tranches of cash ended up paid out with no Substantially checking to the progress of assignments.

The overwhelming majority of these grants have been built by way of proactive funding, which was at the center of your looting from the lottery. Proactive funding allowed the Minister of Trade, Business and Levels of competition, or maybe the NLC together with its board, to discover will cause to fund with out very first requiring an software. This was stopped any time a new NLC board was appointed.

R2-billion in grants less than investigation
SIU head Advocate Andy Mothibi stated the SIU was presently investigating grants valued at over R2-billion, as well as unit was however often acquiring idea-offs about far more corruption.

He told MPs the SIU’s investigation were damaged into three phases: the 1st, that has been finalised, probed dodgy grants amounting to R280-million, and the 2nd, also completed, concerned R247-million. In the 3rd phase, as a result of be finalised at the end of the yr, the SIU is investigating grants valued at Practically R906-million, involving forty NPOs and NPCs, Mothibi said.

He stated that the SIU would apply “soon” with the Presidential Proclamation, initially granted in October 2020 to investigate corruption involving lottery grants, to be prolonged to include procurement because of the NLC.

The SIU investigation had so far triggered 13 disciplinary referrals towards the NLC, and administrative referrals to SARS and the businesses and Intellectual Qualities Commission to blacklist people today implicated inside the looting. Issues involving two people today were referred for the Authorized Follow Council and the SA Institute of Chartered Accountants.

The SIU had observed numerous developments beneath the preceding NLC board and government - a lot of whom are actually implicated in looting - Mothibi told MPs.

This incorporated a “trend of collusion concerning NLC officers and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “standard maladministration while in the approval of grants,” he said.

Sluggish development through the NPA
The SIU has frozen homes, Homes, cars as well as other belongings well worth tens of thousands and thousands which were acquired with lottery funds, but MPs expressed problem at sluggish progress in prosecuting All those associated with the looting. (The SIU is mandated only to Get well belongings acquired with stolen condition cash and doesn't have prosecuting powers).

Whilst the SIU has referred 15 matters on the NPA, to date only two individuals have been brought ahead of a courtroom. Two Guys appeared in courtroom in Kimberley recently in connection with misappropriated funds collected for any undertaking to combat gender-based violence.

In August 2022 Christopher Tshivule was sentenced to 8 several years in jail for his aspect in a R1.5-million lottery grant fraud. Charges from two persons billed with him, who the SIU has referred to as “kingpins” within the corruption that overcome the NLC, were being dropped.

Key-Typical Mmeli Makinyane, the performing divisional commissioner for precedence offences, advised MPs which the Hawks were at the moment investigating sixteen lottery corruption-related circumstances. Another just one - the Kimberley make a difference - is right before a courtroom and two are despatched into the NPA for a choice to prosecute. An additional five conditions are now being investigated through the SAPS detective and forensic providers, he said.

Explaining the reasons with the hold off in prosecutions, NPA Deputy National Director Rodney de Kock claimed A part of the reason was the Hawks had to do further more investigations after they acquired dossiers through the SIU.

“In essence, the investigations undertaken through the SIU usually do not fulfill prison benchmarks for prosecutions.”

Hence, the NPA experienced to operate with investigators from the DPCI (the Hawks) and SAPS to carry out felony investigations and make certain that the evidence satisfies felony prosecution specifications, he said, introducing: “That said, the do the job in the SIU is important and contributes drastically to this method.”

De Kock said that the SIU’s investigation “generally brings about multiple referrals. The referrals may possibly in the long run result in a single docket and just one court docket scenario.”

He claimed that twelve issues, that happen to be “somewhere around 85% comprehensive”, ended up currently being jointly investigated with the Hawks as well as the SIU’s Specialised Financial Operations Unit. (Many of these instances, 7 of which had been lodged in 2020, include previous NLC chief operating officer Phillemon Letwaba, who resigned beneath a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)

De Kock explained the NPA confronted various “difficulties” in prosecuting scenarios. These, he said, incorporated

the lapse of your time concerning when the offences had been committed as well as the issuing on the Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary proof” (Before this 12 months, the SIU instructed the committee that key files wanted in a few prosecutions had been deleted in the NLC Personal computer method or experienced absent missing from Metrofile, a warehouse exactly where copies of files are archived and stored);
The point that some implicated men and women are still used by NLC; and
A challenge to your legality on the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is devoted to guaranteeing finalisation in these issues. To this stop, a team of dedicated prosecutors has actually been allotted to supervise all NLC issues currently below investigation,” de Kock mentioned. “Matters are dealt with like a priority. When [the] investigations are accomplished, the NPA can make a decision.”

What the companies say (or don’t)
GroundUp was only capable of get comment from among the 5 corporations accused with the SIU in Parliament of producing fraudulent once-a-year economic statements,TTP Consulting.

Aubrey Moeng, among TTP’s two administrators, mentioned within an e-mail in reaction to inquiries: “On account of shopper confidentiality, we need to advise that TTP Consulting is not really willing to divulge shoppers’ monetary confidential facts with the general public or media … with no consent of the client or even a legal explanation.”

The corporate is really a “spouse” of a number of state entities, including SARS and the CIPC, according to its Web-site.

Neither of the two administrators of Dzata Accountants, who're both stated as inactive about the CIPC sign up of organizations, responded to emailed thoughts. The business has been deregistered with the CIPC for failing to post monetary statements due to the fact 2021.

The only real director of Mageba Ntuli Investing and Consulting Services, Patrick Zulu, died three a long time ago, In line with official information. The business was deregistered with the CIPC for failing to submit monetary statements given that 2021.

Matamela Magodi, the sole director of Magodi Consultants, didn't respond to questions emailed to him.

GroundUp was struggling to uncover any listing for Tafta Consulting and Accounting Expert services Together with the CIPC. We have been also unable to trace any of the corporate’s directors to request remark.