The accountants who assisted loot the Lottery
The accountants who assisted loot the Lottery
Blog Article
The Unique Investigating Unit has discovered five accounting corporations that helped loot Lottery money. Graphic: Lisa Nelson
The Distinctive Investigating Device has identified five accounting and auditing companies that assisted non-gain organizations loot Lottery dollars supposed for “superior triggers”.
The accounting firms compiled fraudulent economic statements utilized by these organizations to apply for Lottery funding, the SIU informed Parliament.
Performing chief national investigations officer Zodwa Xesibe said the SIU would choose action to possess these corporations blacklisted.
A four-calendar year probe because of the ruay Exclusive Investigating Device (SIU) has exposed 5 accounting and auditing corporations that aided dodgy non-gain organizations loot a huge selection of a lot of rands meant for “great brings about” from the Lottery.
These firms ended up explained by the SIU as “Skilled enablers,” who “compiled fraudulent fiscal statements” that were utilized by the companies to submit an application for Lottery funding.
The five organizations were being named in Parliament with the SIU’s performing Main national investigations officer Zodwa Xesibe. They are TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Expert services.
Fraudulent financials produced by these 5 accounting firms assisted nearly 40 organizations get their palms on lottery funding, based on the SIU presentation.
Based upon a Software made up of details with all lottery grants since 2002, these companies got around R314-million in funding.
“These NPCs were being funded with the National Lotteries Fee (NLC) even so the funds weren't utilized for his or her intended reason,” Xesibe informed Parliament’s Trade, Industry and Competition Portfolio Committee previous 7 days.
The SIU, the Hawks and the Nationwide Prosecuting Authority (NPA) ended up in Parliament to report back to the committee on development in bringing people and organisations associated with looting the lottery to ebook.
Xesibe explained to GroundUp which the SIU meant to lodge issues versus the accounting corporations included and was checking if these firms had been registered and, If that's the case, with which Expert bodies.
“We want these providers being blacklisted,” she advised GroundUp.
To qualify for Lottery funding, an organisation was required to produce two yrs of annual financial statements, Xesibe spelled out in Parliament.
Nonetheless, being an ongoing six-12 months investigation into lottery corruption by GroundUp has revealed, hijacked non-financial gain organisations (NPOs) or new shelf non-profit firms (NPCs) without financial track information have been accustomed to make an application for funding.
In a few occasions, Pretty much equivalent economical statements were being manufactured for unrelated organisations, normally with just the names on the organisations modified, GroundUp’s investigation identified.
Documents submitted by authentic 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 in the unsuccessful applicants have been equipped by senior Lottery officers to your dodgy applicants.
With cursory or - usually - no verification, these dodgy applicants had been awarded countless rands in grants. In some cases added tranches of resources had been paid out devoid of A lot checking around the development of projects.
The overwhelming majority of such grants were being made via proactive funding, which was at the guts of your looting with the lottery. Proactive funding allowed the Minister of Trade, Business and Competitors, or even the NLC along side its board, to determine triggers to fund without having 1st requiring an software. This was stopped when a new NLC board was appointed.
R2-billion in grants underneath investigation
SIU head Advocate Andy Mothibi mentioned the SIU was at the moment investigating grants valued at above R2-billion, and also the device was still regularly getting idea-offs about more corruption.
He advised MPs the SIU’s investigation had been broken into three phases: the primary, that has been finalised, probed dodgy grants amounting to R280-million, and the next, also accomplished, included R247-million. While in the third section, due to be finalised at the conclusion of the yr, the SIU is investigating grants valued at Nearly R906-million, involving forty NPOs and NPCs, Mothibi mentioned.
He said the SIU would utilize “quickly” with the Presidential Proclamation, originally granted in Oct 2020 to analyze corruption involving lottery grants, to become extended to incorporate procurement by the NLC.
The SIU investigation had thus far triggered thirteen disciplinary referrals towards the NLC, and administrative referrals to SARS and the Companies and Intellectual Qualities Commission to blacklist persons implicated in the looting. Complaints involving two people were referred to the Lawful Exercise Council as well as SA Institute of Chartered Accountants.
The SIU experienced observed numerous trends underneath the former NLC board and govt - lots of whom are implicated in looting - Mothibi instructed MPs.
This incorporated a “trend of collusion involving NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “normal maladministration within the acceptance of grants,” he said.
Sluggish progress by the NPA
The SIU has frozen properties, Houses, cars and also other belongings truly worth tens of millions that were bought with lottery resources, but MPs expressed concern at gradual development in prosecuting All those linked to the looting. (The SIU is mandated only to Get well property bought with stolen point out cash and does not have prosecuting powers).
Whilst the SIU has referred fifteen matters towards the NPA, so far only two folks have been brought before a courtroom. Two Males appeared in court docket in Kimberley not too long ago in reference to misappropriated money gathered to get a job to fight gender-dependent violence.
In August 2022 Christopher Tshivule was sentenced to 8 a long time in jail for his section inside a R1.5-million lottery grant fraud. Fees versus two individuals charged with him, who the SIU has described as “kingpins” inside the corruption that overwhelmed the NLC, had been dropped.
Main-Standard Mmeli Makinyane, the acting divisional commissioner for priority offences, explained to MPs which the Hawks ended up at the moment investigating 16 lottery corruption-associated cases. Another just one - the Kimberley issue - is just before a court docket and two are already despatched on the NPA for a call to prosecute. An additional 5 cases are now being investigated via the SAPS detective and forensic providers, he reported.
Explaining the reasons to the delay in prosecutions, NPA Deputy Nationwide Director Rodney de Kock reported part of The main reason was that the Hawks had to do additional investigations after they obtained dossiers from your SIU.
“In essence, the investigations undertaken by the SIU never fulfill legal requirements for prosecutions.”
Consequently, the NPA experienced to work with investigators during the DPCI (the Hawks) and SAPS to carry out prison investigations and be sure that the evidence fulfills prison prosecution specifications, he said, including: “Having said that, the work in the SIU is important and contributes tremendously to this process.”
De Kock claimed which the SIU’s investigation “often results in numerous referrals. The referrals could eventually cause just one docket and just one courtroom situation.”
He mentioned that 12 issues, which might be “about 85% entire”, ended up getting jointly investigated through the Hawks and also the SIU’s Specialised Financial Functions Unit. (A large number of situations, 7 of which had been lodged in 2020, require previous NLC chief working officer Phillemon Letwaba, who resigned underneath a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)
De Kock stated the NPA faced many “worries” in prosecuting instances. These, he mentioned, involved
the lapse of your time involving if the offences ended up dedicated along with the issuing on the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary evidence” (Before this yr, the SIU informed the committee that key files essential in some prosecutions were deleted from your NLC Pc procedure or had absent lacking from Metrofile, a warehouse the place copies of files are archived and stored);
The reality that some implicated people are still used by NLC; and
A obstacle for the legality with the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is committed to ensuring finalisation in these matters. To this stop, a staff of focused prosecutors has been allocated to supervise all NLC issues now less than investigation,” de Kock said. “Issues are managed being a priority. As soon as [the] investigations are completed, the NPA could make a choice.”
What the companies say (or don’t)
GroundUp was only ready to get comment from one of many 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, said in an e mail in reaction to questions: “On account of shopper confidentiality, we wish to advise that TTP Consulting is just not ready to disclose purchasers’ money private information and facts with the general public or media … with no consent on the customer or possibly a authorized purpose.”
The organization is really a “companion” of several point out entities, like SARS and also the CIPC, according to its Web page.
Neither of the two directors of Dzata Accountants, who will be the two listed as inactive about the CIPC sign up of businesses, responded to emailed issues. The company is deregistered because of the CIPC for failing to post economical statements given that 2021.
The only director of Mageba Ntuli Trading and Consulting Support, Patrick Zulu, died three many years ago, Based on Formal documents. The corporate was deregistered with the CIPC for failing to submit financial 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 locate any listing for Tafta Consulting and Accounting Solutions While using the CIPC. We have been also struggling to trace any of the organization’s directors to request remark.