The Particular Investigating Unit has discovered five accounting corporations that helped loot Lottery resources. Graphic: Lisa Nelson
The Exclusive Investigating Device has recognized 5 accounting and auditing corporations that assisted non-earnings businesses loot Lottery revenue intended for “superior triggers”.
The accounting companies compiled fraudulent money statements employed by these firms to submit an application for Lottery funding, the SIU told Parliament.
Acting Main countrywide investigations officer Zodwa Xesibe claimed the SIU would consider action to acquire these corporations blacklisted.
A 4-12 months probe via the ruay Specific Investigating Unit (SIU) has exposed five accounting and auditing firms that served dodgy non-revenue businesses loot numerous numerous rands meant for “superior will cause” through the Lottery.
These firms ended up described via the SIU as “Specialist enablers,” who “compiled fraudulent monetary statements” which were used by the businesses to submit an application for Lottery funding.
The five providers have been named in Parliament by the SIU’s acting Main national investigations officer Zodwa Xesibe. They are TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Products and services.
Fraudulent financials produced by these five accounting companies aided approximately forty businesses get their palms on lottery funding, based on the SIU presentation.
Based upon a Software made up of details with all lottery grants considering that 2002, these providers got above R314-million in funding.
“These NPCs have been funded through the National Lotteries Fee (NLC) though the funds weren't applied for their meant objective,” Xesibe explained to Parliament’s Trade, Field and Competition Portfolio Committee previous 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 people today and organisations involved in looting the lottery to ebook.
Xesibe told GroundUp that the SIU intended to lodge problems against the accounting firms involved and was examining if these corporations were registered and, If that's the case, with which Expert bodies.
“We wish these companies to become blacklisted,” she informed GroundUp.
To qualify for Lottery funding, an organisation was required to produce two decades of annual monetary statements, Xesibe explained in Parliament.
Having said that, as an ongoing 6-year investigation into lottery corruption by GroundUp has disclosed, hijacked non-income organisations (NPOs) or new shelf non-profit organizations (NPCs) without economical track information had been used to make an application for funding.
In a few cases, Pretty much equivalent money statements were being produced for unrelated organisations, normally with just the names of your organisations changed, GroundUp’s investigation found.
Paperwork submitted by legitimate NPCs for unsuccessful grant purposes were often utilized by new or hijacked NPCs and NPOs to make an application for funding. The small print and documents in the unsuccessful applicants have been supplied by senior Lottery officers for the dodgy applicants.
With cursory or - usually - no verification, these dodgy applicants had been awarded an incredible number of rands in grants. Occasionally supplemental tranches of funds were being paid out out without having A lot examining within the development of projects.
The vast majority of such grants were designed via proactive funding, which was at the center of your looting on the lottery. Proactive funding permitted the Minister of Trade, Field and Levels of competition, or perhaps the NLC along side its board, to discover triggers to fund without to start with necessitating an software. This was stopped every time a new NLC board was appointed.
R2-billion in grants beneath investigation
SIU head Advocate Andy Mothibi stated the SIU was at this time investigating grants valued at over R2-billion, along with the device was even now routinely acquiring tip-offs about extra corruption.
He informed MPs the SIU’s investigation had been broken into a few phases: the very first, which has been finalised, probed dodgy grants amounting to R280-million, and the 2nd, also done, associated R247-million. In the 3rd stage, on account of be finalised at the end of the calendar year, the SIU is investigating grants valued at Practically R906-million, involving forty NPOs and NPCs, Mothibi claimed.
He mentioned which the SIU would use “before long” for that Presidential Proclamation, at first granted in October 2020 to research corruption involving lottery grants, to generally be extended to include procurement with the NLC.
The SIU investigation experienced so far led to 13 disciplinary referrals for the NLC, and administrative referrals to SARS and the Companies and Intellectual Homes Commission to blacklist men and women implicated from the looting. Issues involving two persons were referred for the Legal Practice Council and the SA Institute of Chartered Accountants.
The SIU experienced observed several traits beneath the previous NLC board and government - many of whom have been implicated in looting - Mothibi instructed MPs.
This provided a “development of collusion amongst NLC officers and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “basic maladministration in the approval of grants,” he explained.
Gradual progress through the NPA
The SIU has frozen residences, Attributes, cars together with other belongings truly worth tens of millions which were acquired with lottery cash, but MPs expressed worry at sluggish progress in prosecuting those linked to the looting. (The SIU is mandated only to Get better property bought with stolen point out money and doesn't have prosecuting powers).
When the SIU has referred 15 issues on the NPA, so far only two folks have been brought right before a courtroom. Two Adult males appeared in courtroom in Kimberley recently in connection with misappropriated cash gathered to get a job to combat gender-based mostly violence.
In August 2022 Christopher Tshivule was sentenced to 8 years in prison for his element in a very R1.five-million lottery grant fraud. Charges against two folks charged with him, who the SIU has described as “kingpins” inside the corruption that overwhelmed the NLC, had been dropped.
Main-Common Mmeli Makinyane, the acting divisional commissioner for precedence offences, advised MPs that the Hawks were now investigating sixteen lottery corruption-associated cases. A further just one - the Kimberley issue - is prior to a courtroom and two have already been despatched towards the NPA for a choice to prosecute. A further five cases are now being investigated via the SAPS detective and forensic solutions, he claimed.
Conveying The explanations for the delay in prosecutions, NPA Deputy National Director Rodney de Kock stated Portion of The explanation was the Hawks had to do additional investigations once they received dossiers from the SIU.
“In essence, the investigations carried out with the SIU tend not to satisfy felony expectations for prosecutions.”
As a result, the NPA experienced to work with investigators during the DPCI (the Hawks) and SAPS to carry out prison investigations and be certain that the proof meets legal prosecution benchmarks, he mentioned, introducing: “Having said that, the perform with the SIU is essential and contributes drastically to this method.”
De Kock claimed which the SIU’s investigation “normally brings about various referrals. The referrals may ultimately result in one docket and one court docket scenario.”
He mentioned that 12 issues, that happen to be “around eighty five% comprehensive”, had been being jointly investigated because of the Hawks plus the SIU’s Specialised Economic Operations Device. (Many of these scenarios, 7 of which have been lodged in 2020, contain previous NLC chief working officer Phillemon Letwaba, who resigned underneath a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)
De Kock said the NPA faced a number of “issues” in prosecuting scenarios. These, he reported, included
the lapse of your time concerning in the event the offences were being fully commited plus the issuing with the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary proof” (Before this yr, the SIU informed the committee that key paperwork necessary in certain prosecutions had been deleted from the NLC Laptop or computer technique or experienced gone lacking from Metrofile, a warehouse where copies of paperwork are archived and saved);
the fact that some implicated men and women remain used by NLC; and
A challenge on the legality of your Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is committed to ensuring finalisation in these matters. To this stop, a crew of committed prosecutors has actually been allotted to supervise all NLC matters at present beneath investigation,” de Kock mentioned. “Matters are handled as a precedence. After [the] investigations are accomplished, the NPA will make a call.”
What the companies say (or don’t)
GroundUp was only in a position to get remark from one of several five corporations accused through the SIU in Parliament of manufacturing fraudulent annual money statements,TTP Consulting.
Aubrey Moeng, among TTP’s two administrators, said in an e mail in reaction to questions: “Resulting from shopper confidentiality, we want to suggest that TTP Consulting is just not prepared to disclose purchasers’ economical 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 “partner” of several condition entities, which includes SARS and the CIPC, In keeping with its Internet site.
Neither of the two directors of Dzata Accountants, that are each stated as inactive around the CIPC sign-up of companies, responded to emailed queries. The corporation continues to be deregistered because of the CIPC for failing to post economical statements because 2021.
The sole director of Mageba Ntuli Trading and Consulting Support, Patrick Zulu, died three many years ago, Based on Formal documents. The corporate was deregistered because of the CIPC for failing to submit monetary statements since 2021.
Matamela Magodi, the only real director of Magodi Consultants, did not reply to queries emailed to him.
GroundUp was struggling to uncover any listing for Tafta Consulting and Accounting Solutions with the CIPC. We have been also struggling to trace any of the organization’s administrators to request remark.