The accountants who aided loot the Lottery
The accountants who aided loot the Lottery
Blog Article
The Unique Investigating Device has determined five accounting corporations that helped loot Lottery cash. Graphic: Lisa Nelson
The Particular Investigating Device has identified 5 accounting and auditing corporations that served non-profit organizations loot Lottery money supposed for “fantastic will cause”.
The accounting firms compiled fraudulent economic statements utilized by these providers to apply for Lottery funding, the SIU advised Parliament.
Acting chief nationwide investigations officer Zodwa Xesibe said the SIU would take motion to acquire these companies blacklisted.
A four-year probe through the cat888 Distinctive Investigating Unit (SIU) has uncovered five accounting and auditing corporations that assisted dodgy non-earnings businesses loot many hundreds of many rands designed for “very good leads to” within the Lottery.
These corporations had been described by the SIU as “Specialist enablers,” who “compiled fraudulent financial statements” which were used by the companies to submit an application for Lottery funding.
The 5 organizations have been named in Parliament with the SIU’s acting Main national investigations officer Zodwa Xesibe. They're TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Solutions.
Fraudulent financials made by these 5 accounting companies helped nearly 40 providers get their palms on lottery funding, according to the SIU presentation.
According to a Resource made up of information with all lottery grants since 2002, these firms obtained around R314-million in funding.
“These NPCs were funded with the Countrywide Lotteries Commission (NLC) however the funds were not utilized for his or her intended intent,” Xesibe advised Parliament’s Trade, Field and Competitors Portfolio Committee past 7 days.
The SIU, the Hawks as well as the Nationwide Prosecuting Authority (NPA) were in Parliament to report to the committee on development in bringing people and organisations associated with looting the lottery to book.
Xesibe instructed GroundUp which the SIU intended to lodge grievances from the accounting corporations associated and was examining if these companies were being registered and, If that's the case, with which Specialist bodies.
“We would like these firms for being blacklisted,” she informed GroundUp.
To qualify for Lottery funding, an organisation was required to produce two decades of yearly monetary statements, Xesibe defined in Parliament.
Nonetheless, as an ongoing 6-year investigation into lottery corruption by GroundUp has discovered, hijacked non-earnings organisations (NPOs) or new shelf non-revenue providers (NPCs) with no economical track records ended up utilized to submit an application for funding.
In some cases, Just about equivalent financial statements had been generated for unrelated organisations, often with just the names of the organisations altered, GroundUp’s investigation discovered.
Documents submitted by legitimate NPCs for unsuccessful grant apps have been usually used by new or hijacked NPCs and NPOs to apply for funding. The main points and files in the unsuccessful applicants had been provided by senior Lottery officials to the dodgy applicants.
With cursory or - normally - no verification, these dodgy applicants ended up awarded a lot of rands in grants. At times additional tranches of money were compensated out with out Substantially checking around the progress of initiatives.
The overwhelming majority of such grants were being produced by way of proactive funding, which was at the heart of the looting of the lottery. Proactive funding authorized the Minister of Trade, Sector and Level of competition, or maybe the NLC along side its board, to establish triggers to fund with out to start with necessitating an software. This was stopped when a new NLC board was appointed.
R2-billion in grants underneath investigation
SIU head Advocate Andy Mothibi said the SIU was at the moment investigating grants valued at about R2-billion, and also the unit was even now consistently acquiring idea-offs about much more corruption.
He told MPs that the SIU’s investigation were damaged into 3 phases: the main, that has been finalised, probed dodgy grants amounting to R280-million, and the next, also accomplished, concerned R247-million. Within the 3rd period, resulting from be finalised at the end of the year, the SIU is investigating grants valued at almost R906-million, involving forty NPOs and NPCs, Mothibi mentioned.
He said the SIU would apply “before long” for your Presidential Proclamation, at first granted in October 2020 to research corruption involving lottery grants, for being prolonged to include procurement with the NLC.
The SIU investigation experienced so far resulted in thirteen disciplinary referrals to your NLC, and administrative referrals to SARS and the businesses and Mental Properties Commission to blacklist folks implicated while in the looting. Issues involving two men and women had been referred for the Legal Practice Council and also the SA Institute of Chartered Accountants.
The SIU experienced noticed many developments under the prior NLC board and govt - lots of whom are implicated in looting - Mothibi advised MPs.
This provided a “trend of collusion concerning NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “general maladministration from the approval of grants,” he reported.
Sluggish development because of the NPA
The SIU has frozen residences, Homes, vehicles along with other belongings really worth tens of tens of millions which were bought with lottery money, but MPs expressed worry at gradual development in prosecuting Individuals involved with the looting. (The SIU is mandated only to Get better assets purchased with stolen condition money and does not have prosecuting powers).
Although the SIU has referred 15 matters to your NPA, to date only two individuals have been introduced ahead of a court. Two Adult males appeared in court docket in Kimberley recently in connection with misappropriated money collected for any job to fight gender-based violence.
In August 2022 Christopher Tshivule was sentenced to 8 a long time in jail for his element inside a R1.5-million lottery grant fraud. Prices towards two persons billed with him, who the SIU has described as “kingpins” inside the corruption that overcome the NLC, ended up dropped.
Big-Typical Mmeli Makinyane, the performing divisional commissioner for precedence offences, advised MPs the Hawks had been at the moment investigating 16 lottery corruption-connected circumstances. One more just one - the Kimberley matter - is prior to a court and two happen to be sent towards the NPA for a decision to prosecute. An extra five scenarios are increasingly being investigated because of the SAPS detective and forensic expert services, he explained.
Explaining the reasons with the delay in prosecutions, NPA Deputy Countrywide Director Rodney de Kock stated A part of The key reason why was that the Hawks had to do further more investigations whenever they received dossiers with the SIU.
“In essence, the investigations undertaken through the SIU tend not to fulfill prison requirements for prosecutions.”
Thus, the NPA experienced to operate with investigators in the DPCI (the Hawks) and SAPS to carry out legal investigations and be sure that the evidence satisfies legal prosecution benchmarks, he stated, introducing: “That said, the function of the SIU is important and contributes considerably to this process.”
De Kock claimed which the SIU’s investigation “usually leads to various referrals. The referrals could finally lead to just one docket and 1 courtroom scenario.”
He claimed that twelve matters, which are “somewhere around eighty five% entire”, had been becoming jointly investigated from the Hawks as well as the SIU’s Specialised Economic Functions Unit. (The majority of these scenarios, seven of which were lodged in 2020, entail previous NLC chief running officer Phillemon Letwaba, who resigned under a cloud in 2022, and Pretoria attorney Leslie Ramulifho.)
De Kock said the NPA faced various “problems” in prosecuting circumstances. These, he claimed, integrated
the lapse of time involving in the event the offences were being fully commited and the issuing from the Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary proof” (Previously this yr, the SIU informed the committee that crucial documents needed in certain prosecutions had been deleted in the NLC Personal computer method or experienced gone lacking from Metrofile, a warehouse in which copies of files are archived and stored);
The reality that some implicated folks remain used by NLC; and
A challenge on the legality of your Presidential Proclamation by former NLC chairperson Alfred Nevhutanda.
“The NPA is committed to guaranteeing finalisation in these issues. To this end, a group of committed prosecutors has been allocated to oversee all NLC matters at the moment underneath investigation,” de Kock said. “Issues are managed being a priority. After [the] investigations are accomplished, the NPA is likely to make a choice.”
What the companies say (or don’t)
GroundUp was only capable to get comment from one of the 5 organizations accused by the SIU in Parliament of manufacturing fraudulent annual fiscal statements,TTP Consulting.
Aubrey Moeng, certainly one of TTP’s two administrators, reported in an e mail in reaction to concerns: “Resulting from shopper confidentiality, we desire to suggest that TTP Consulting will not be prepared to disclose clients’ monetary confidential info with the public or media … with no consent of the shopper or a lawful motive.”
The corporate is often a “associate” of many state entities, together with SARS plus the CIPC, In line with its Web site.
Neither of The 2 administrators of Dzata Accountants, who're each stated as inactive about the CIPC sign up of organizations, responded to emailed thoughts. The business has long been deregistered from the CIPC for failing to submit fiscal statements considering the fact that 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 organization was deregistered from the CIPC for failing to post economical statements considering the fact that 2021.
Matamela Magodi, the only director of Magodi Consultants, did not reply to concerns emailed to him.
GroundUp was struggling to uncover any listing for Tafta Consulting and Accounting Providers with the CIPC. We ended up also unable to trace any of the business’s administrators to ask for comment.