The Specific Investigating Unit has determined 5 accounting firms that assisted loot Lottery money. Graphic: Lisa Nelson
The Unique Investigating Device has recognized five accounting and auditing companies that aided non-earnings corporations loot Lottery money intended for “very good causes”.
The accounting corporations compiled fraudulent financial statements utilized by these providers to make an application for Lottery funding, the SIU informed Parliament.
Acting chief countrywide investigations officer Zodwa Xesibe said the SIU would take action to have these firms blacklisted.
A 4-year probe via the หุ้น ชอง 9 Distinctive Investigating Device (SIU) has exposed 5 accounting and auditing firms that aided dodgy non-gain firms loot a huge selection of a lot of rands meant for “very good causes” from your Lottery.
These companies ended up explained with the SIU as “Experienced enablers,” who “compiled fraudulent money statements” which were employed by the companies to apply for Lottery funding.
The 5 corporations had been named in Parliament with the SIU’s performing Main national 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 served nearly forty businesses get their fingers on lottery funding, based on the SIU presentation.
Depending on a Instrument made up of facts with all lottery grants because 2002, these companies acquired around R314-million in funding.
“These NPCs ended up funded because of the National Lotteries Commission (NLC) though the funds weren't utilized for their meant purpose,” Xesibe advised Parliament’s Trade, Marketplace and Competitors Portfolio Committee last 7 days.
The SIU, the Hawks and also the Countrywide Prosecuting Authority (NPA) have been in Parliament to report to the committee on progress in bringing men and women and organisations involved in looting the lottery to reserve.
Xesibe advised GroundUp which the SIU meant to lodge grievances against the accounting firms included and was examining if these corporations were registered and, If that is so, with which Expert bodies.
“We want these corporations to become blacklisted,” she advised GroundUp.
To qualify for Lottery funding, an organisation was needed to produce two yrs of yearly economical statements, Xesibe spelled out in Parliament.
Nevertheless, as an ongoing 6-yr investigation into lottery corruption by GroundUp has uncovered, hijacked non-profit organisations (NPOs) or new shelf non-gain corporations (NPCs) without any monetary keep track of records ended up used to submit an application for funding.
In a few situations, almost similar money statements were developed for unrelated organisations, often with only the names in the organisations adjusted, GroundUp’s investigation found.
Documents submitted by authentic NPCs for unsuccessful grant purposes were being often employed by new or hijacked NPCs and NPOs to submit an application for funding. The small print and paperwork in the unsuccessful applicants were provided by senior Lottery officials on the dodgy applicants.
With cursory or - normally - no verification, these dodgy applicants were awarded numerous rands in grants. Sometimes further tranches of resources had been paid out out devoid of Substantially examining about the progress of projects.
The vast majority of those grants ended up made by means of proactive funding, which was at the guts from the looting on the lottery. Proactive funding authorized the Minister of Trade, Industry and Level of competition, or maybe the NLC in conjunction with its board, to recognize results in to fund with out first demanding an application. This was stopped each time a new NLC board was appointed.
R2-billion in grants beneath investigation
SIU head Advocate Andy Mothibi stated the SIU was currently investigating grants valued at around R2-billion, as well as unit was however frequently obtaining suggestion-offs about much more corruption.
He advised 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 finished, concerned R247-million. In the third stage, as a consequence of be finalised at the conclusion of the 12 months, the SIU is investigating grants valued at Practically R906-million, involving 40 NPOs and NPCs, Mothibi said.
He reported the SIU would use “soon” for the Presidential Proclamation, at first granted in October 2020 to analyze corruption involving lottery grants, being prolonged to include procurement through the NLC.
The SIU investigation experienced thus far resulted in 13 disciplinary referrals to the NLC, and administrative referrals to SARS and the Companies and Mental Homes Fee to blacklist folks implicated during the looting. Complaints involving two persons were referred into the Lawful Apply Council as well as SA Institute of Chartered Accountants.
The SIU experienced noticed a number of trends under the earlier NLC board and government - a lot of whom are actually implicated in looting - Mothibi told MPs.
This incorporated a “trend of collusion in between NLC officers and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “basic maladministration in the approval of grants,” he stated.
Gradual progress from the NPA
The SIU has frozen homes, Homes, cars and various assets truly worth tens of thousands and thousands that were purchased with lottery resources, but MPs expressed concern at slow progress in prosecuting All those involved in the looting. (The SIU is mandated only to recover property purchased with stolen point out resources and doesn't have prosecuting powers).
While the SIU has referred 15 matters for the NPA, thus far only two folks have been introduced in advance of a court docket. Two men appeared in court docket in Kimberley a short while ago in connection with misappropriated funds gathered for any project to combat gender-dependent violence.
In August 2022 Christopher Tshivule was sentenced to 8 several years in prison for his portion inside a R1.5-million lottery grant fraud. Prices versus two folks charged with him, who the SIU has called “kingpins” inside the corruption that overcome the NLC, were being dropped.
Main-Standard Mmeli Makinyane, the performing divisional commissioner for precedence offences, told MPs the Hawks ended up currently investigating 16 lottery corruption-associated instances. A different one - the Kimberley matter - is before a courtroom and two have already been despatched on the NPA for a call to prosecute. An additional five conditions are being investigated because of the SAPS detective and forensic providers, he claimed.
Explaining the reasons to the delay in prosecutions, NPA Deputy Nationwide Director Rodney de Kock said Section of the reason was that the Hawks had to do additional investigations every time they obtained dossiers through the SIU.
“In essence, the investigations undertaken through the SIU tend not to satisfy criminal specifications for prosecutions.”
Thus, the NPA experienced to operate with investigators during the DPCI (the Hawks) and SAPS to conduct legal investigations and ensure that the proof meets prison prosecution standards, he said, incorporating: “Having said that, the operate with the SIU is crucial and contributes enormously to this process.”
De Kock reported the SIU’s investigation “usually results in various referrals. The referrals could ultimately cause one particular docket and just one court docket circumstance.”
He said that 12 matters, which happen to be “roughly 85% full”, had been currently being jointly investigated because of the Hawks plus the SIU’s Specialised Economic Functions Unit. (These types of scenarios, seven of which were being lodged in 2020, entail former NLC chief functioning officer Phillemon Letwaba, who resigned underneath a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)
De Kock explained the NPA confronted numerous “worries” in prosecuting circumstances. These, he reported, integrated
the lapse of time between once the offences ended up committed plus the issuing in the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary evidence” (Previously this yr, the SIU explained to the committee that key files needed in certain prosecutions had been deleted in the NLC Personal computer method or experienced absent lacking from Metrofile, a warehouse the place copies of files are archived and stored);
The point that some implicated men and women remain employed by NLC; and
A problem to the legality on the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is dedicated to ensuring finalisation in these matters. To this finish, a crew of committed prosecutors has been allocated to supervise all NLC issues currently under investigation,” de Kock stated. “Issues are taken care of to be a precedence. The moment [the] investigations are concluded, the NPA can make a decision.”
What the businesses say (or don’t)
GroundUp was only ready to get comment from one of many 5 providers accused because of the SIU in Parliament of producing fraudulent yearly monetary statements,TTP Consulting.
Aubrey Moeng, one of TTP’s two directors, reported in an e mail in reaction to concerns: “As a consequence of client confidentiality, we would like to recommend that TTP Consulting is not willing to divulge clientele’ money private information and facts with the general public or media … with no consent of your shopper or simply a lawful motive.”
The corporate is often a “associate” of many state entities, including SARS and the CIPC, according to its Web-site.
Neither of the two administrators of Dzata Accountants, who're both of those shown as inactive on the CIPC sign-up of companies, responded to emailed issues. The organization has been deregistered through the CIPC for failing to submit money statements because 2021.
The sole director of Mageba Ntuli Buying and selling and Consulting Assistance, Patrick Zulu, died a few years ago, In accordance with official records. The organization was deregistered from the CIPC for failing to post economical statements since 2021.
Matamela Magodi, the only real director of Magodi Consultants, did not reply to inquiries emailed to him.
GroundUp was unable to find any listing for Tafta Consulting and Accounting Services Along with the CIPC. We had been also struggling to trace any of the business’s administrators to request remark.