The accountants who helped loot the Lottery
The accountants who helped loot the Lottery
Blog Article
The Special Investigating Device has recognized five accounting firms that served loot Lottery money. Graphic: Lisa Nelson
The Exclusive Investigating Unit has determined 5 accounting and auditing companies that aided non-financial gain firms loot Lottery revenue intended for “superior results in”.
The accounting companies compiled fraudulent monetary statements employed by these firms to make an application for Lottery funding, the SIU informed Parliament.
Acting Main national investigations officer Zodwa Xesibe stated the SIU would just take action to have these companies blacklisted.
A 4-12 months probe with the cat888 Unique Investigating Unit (SIU) has exposed five accounting and auditing firms that served dodgy non-profit firms loot numerous many rands intended for “superior brings about” within the Lottery.
These corporations were being explained by the SIU as “Qualified enablers,” who “compiled fraudulent monetary statements” that were used by the companies to apply for Lottery funding.
The 5 organizations had been named in Parliament through the SIU’s acting Main countrywide investigations officer Zodwa Xesibe. They're TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Companies.
Fraudulent financials produced by these 5 accounting firms aided practically 40 firms get their hands on lottery funding, in accordance with the SIU presentation.
Dependant on a tool that contains details with all lottery grants since 2002, these organizations received over R314-million in funding.
“These NPCs were being funded with the Nationwide Lotteries Fee (NLC) even so the funds were not applied for their supposed purpose,” Xesibe advised Parliament’s Trade, Business and Competitiveness Portfolio Committee final 7 days.
The SIU, the Hawks as well as the Countrywide Prosecuting Authority (NPA) have been in Parliament to report back to the committee on development in bringing people today and organisations involved with looting the lottery to book.
Xesibe explained to GroundUp that the SIU meant to lodge complaints against the accounting corporations concerned and was checking if these companies ended up registered and, If that is so, with which Expert bodies.
“We want these companies being blacklisted,” she instructed GroundUp.
To qualify for Lottery funding, an organisation was needed to deliver two years of yearly money statements, Xesibe explained in Parliament.
Even so, as an ongoing six-calendar year investigation into lottery corruption by GroundUp has discovered, hijacked non-gain organisations (NPOs) or new shelf non-profit companies (NPCs) without having financial observe information were accustomed to make an application for funding.
In some scenarios, Practically equivalent economic statements have been manufactured for unrelated organisations, frequently with just the names with the organisations improved, GroundUp’s investigation uncovered.
Paperwork submitted by real NPCs for unsuccessful grant apps have been usually utilized by new or hijacked NPCs and NPOs to apply for funding. The details and files in the unsuccessful applicants have been provided by senior Lottery officials for the dodgy applicants.
With cursory or - frequently - no verification, these dodgy applicants were being awarded a lot of rands in grants. From time to time supplemental tranches of cash were paid out out without A great deal checking within the progress of tasks.
The vast majority of those grants were being made via proactive funding, which was at the heart in the looting of your lottery. Proactive funding allowed the Minister of Trade, Sector and Competition, or the NLC together with its board, to establish leads to to fund with out 1st requiring an software. This was stopped every time a new NLC board was appointed.
R2-billion in grants below investigation
SIU head Advocate Andy Mothibi claimed the SIU was at the moment investigating grants valued at over R2-billion, and also the unit was nonetheless consistently getting suggestion-offs about a lot more corruption.
He instructed MPs which the SIU’s investigation were damaged into a few phases: the 1st, that has been finalised, probed dodgy grants amounting to R280-million, and the 2nd, also finished, involved R247-million. While in the third phase, due to be finalised at the end of the year, the SIU is investigating grants valued at Virtually R906-million, involving 40 NPOs and NPCs, Mothibi stated.
He stated which the SIU would implement “quickly” to the Presidential Proclamation, originally granted in Oct 2020 to research corruption involving lottery grants, for being prolonged to include procurement because of the NLC.
The SIU investigation had to this point brought about thirteen disciplinary referrals to the NLC, and administrative referrals to SARS and the businesses and Intellectual Properties Fee to blacklist people today implicated inside the looting. Issues involving two folks were referred towards the Legal Exercise Council as well as the SA Institute of Chartered Accountants.
The SIU experienced observed numerous tendencies underneath the preceding NLC board and govt - most of whom have already been implicated in looting - Mothibi advised MPs.
This provided a “craze of collusion involving NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “general maladministration in the acceptance of grants,” he mentioned.
Gradual development through the NPA
The SIU has frozen households, Qualities, automobiles along with other belongings really worth tens of hundreds of thousands which were purchased with lottery funds, but MPs expressed problem at gradual development in prosecuting those involved with the looting. (The SIU is mandated only to Get better assets purchased with stolen condition resources and doesn't have prosecuting powers).
Whilst the SIU has referred 15 issues to the NPA, thus far only two people have been brought just before a courtroom. Two Gentlemen appeared in court in Kimberley not too long ago in connection with misappropriated money gathered for your task to fight gender-based violence.
In August 2022 Christopher Tshivule was sentenced to eight several years in jail for his portion in the R1.5-million lottery grant fraud. Rates from two people today billed with him, who the SIU has referred to as “kingpins” inside the corruption that overwhelmed the NLC, ended up dropped.
Key-Common Mmeli Makinyane, the acting divisional commissioner for priority offences, explained to MPs which the Hawks had been presently investigating 16 lottery corruption-similar scenarios. Yet another a person - the Kimberley make any difference - is prior to a court and two happen to be despatched into the NPA for a call to prosecute. An extra five conditions are now being investigated through the SAPS detective and forensic companies, he claimed.
Outlining the reasons for your hold off in prosecutions, NPA Deputy Countrywide Director Rodney de Kock claimed Component of The explanation was which the Hawks had to do further more investigations if they obtained dossiers with the SIU.
“In essence, the investigations carried out from the SIU tend not to fulfill felony criteria for prosecutions.”
Hence, the NPA had to work with investigators inside the DPCI (the Hawks) and SAPS to conduct legal investigations and be certain that the evidence meets criminal prosecution standards, he reported, including: “Having said that, the do the job with the SIU is very important and contributes greatly to this process.”
De Kock said the SIU’s investigation “frequently ends in numerous referrals. The referrals may perhaps in the long run result in one particular docket and one court scenario.”
He reported that twelve issues, which can be “somewhere around eighty five% total”, have been staying jointly investigated because of the Hawks and also the SIU’s Specialised Financial Operations Unit. (The majority of these situations, seven of which were being lodged in 2020, require former NLC chief operating officer Phillemon Letwaba, who resigned underneath a cloud in 2022, and Pretoria lawyer Leslie Ramulifho.)
De Kock said the NPA faced several “worries” in prosecuting scenarios. These, he mentioned, integrated
the lapse of time concerning when the offences have been fully commited and the issuing in the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary evidence” (Earlier this calendar year, the SIU explained to the committee that vital paperwork essential in a few prosecutions had been deleted from your NLC Personal computer technique or had long gone missing from Metrofile, a warehouse where by copies of paperwork are archived and saved);
The reality that some implicated people remain employed by NLC; and
A problem to the legality with the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is committed to making sure finalisation in these issues. To this stop, a staff of dedicated prosecutors has actually been allotted to supervise all NLC issues now below investigation,” de Kock mentioned. “Matters are dealt with as being a priority. As soon as [the] investigations are finished, the NPA will make a call.”
What the companies say (or don’t)
GroundUp was only capable of get remark from one of the 5 organizations accused from the SIU in Parliament of manufacturing fraudulent annual economical statements,TTP Consulting.
Aubrey Moeng, amongst TTP’s two directors, reported in an electronic mail in response to inquiries: “Because of customer confidentiality, we wish to advise that TTP Consulting will not be willing to divulge clientele’ money private information with the public or media … without the consent in the consumer or simply a authorized motive.”
The corporation is a “husband or wife” of quite a few condition entities, like SARS as well as the CIPC, In accordance with its website.
Neither of The 2 directors of Dzata Accountants, that are both stated as inactive around the CIPC sign-up of providers, responded to emailed queries. The corporation is deregistered because of the CIPC for failing to post financial statements considering that 2021.
The only director of Mageba Ntuli Buying and selling and Consulting Provider, Patrick Zulu, died 3 yrs in the past, As outlined by Formal information. The corporate was deregistered with the CIPC for failing to submit economic statements given that 2021.
Matamela Magodi, the sole director of Magodi Consultants, didn't respond to concerns emailed to him.
GroundUp was unable to find any listing for Tafta Consulting and Accounting Products and services While using the CIPC. We have been also struggling to trace any of the corporate’s directors to ask for remark.