The Distinctive Investigating Device has identified five accounting companies that assisted loot Lottery funds. Graphic: Lisa Nelson
The Distinctive Investigating Unit has determined five accounting and auditing companies that aided non-revenue corporations loot Lottery income intended for “good causes”.
The accounting corporations compiled fraudulent fiscal statements used by these providers to make an application for Lottery funding, the SIU told Parliament.
Acting Main countrywide investigations officer Zodwa Xesibe mentioned the SIU would consider action to obtain these firms blacklisted.
A four-year probe from the luckyvip77 Distinctive Investigating Unit (SIU) has uncovered 5 accounting and auditing firms that assisted dodgy non-financial gain businesses loot many millions of rands meant for “fantastic results in” from your Lottery.
These companies ended up explained because of the SIU as “Specialist enablers,” who “compiled fraudulent economical statements” which were employed by the businesses to apply for Lottery funding.
The five companies were named in Parliament from the SIU’s acting Main countrywide investigations officer Zodwa Xesibe. These are TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Expert services.
Fraudulent financials produced by these five accounting firms helped virtually 40 companies get their arms on lottery funding, according to the SIU presentation.
According to a Instrument that contains knowledge with all lottery grants since 2002, these organizations received about R314-million in funding.
“These NPCs have been funded because of the Nationwide Lotteries Commission (NLC) even so the money were not utilized for his or her meant reason,” Xesibe informed Parliament’s Trade, Industry and Competitors Portfolio Committee final week.
The SIU, the Hawks plus the Nationwide Prosecuting Authority (NPA) have been in Parliament to report to the committee on progress in bringing individuals and organisations involved in looting the lottery to book.
Xesibe informed GroundUp that the SIU meant to lodge grievances against the accounting companies involved and was checking if these companies have been registered and, if so, with which Experienced bodies.
“We want these firms to get blacklisted,” she told GroundUp.
To qualify for Lottery funding, an organisation was required to generate two decades of once-a-year fiscal statements, Xesibe stated in Parliament.
Nonetheless, as an ongoing 6-year investigation into lottery corruption by GroundUp has uncovered, hijacked non-income organisations (NPOs) or new shelf non-gain organizations (NPCs) with no money track data have been utilized to apply for funding.
In some occasions, Practically identical financial statements ended up developed for unrelated organisations, often with just the names from the organisations improved, GroundUp’s investigation found.
Documents submitted by legitimate NPCs for unsuccessful grant programs ended up frequently utilized by new or hijacked NPCs and NPOs to make an application for funding. The main points and paperwork on the unsuccessful applicants have been equipped by senior Lottery officers for the dodgy applicants.
With cursory or - frequently - no verification, these dodgy applicants have been awarded many rands in grants. Occasionally more tranches of money were compensated out without much examining about the progress of tasks.
The overwhelming majority of such grants ended up created via proactive funding, which was at the heart on the looting of your lottery. Proactive funding authorized the Minister of Trade, Market and Level of competition, or even the NLC along side its board, to recognize will cause to fund without the need of very first requiring an software. This was stopped any time a new NLC board was appointed.
R2-billion in grants beneath investigation
SIU head Advocate Andy Mothibi stated the SIU was now investigating grants valued at about R2-billion, along with the unit was still consistently getting tip-offs about more corruption.
He informed MPs the SIU’s investigation had been broken into 3 phases: the very first, which has been finalised, probed dodgy grants amounting to R280-million, and the next, also concluded, included R247-million. While in the third stage, on account of be finalised at the conclusion of the yr, the SIU is investigating grants valued at Nearly R906-million, involving 40 NPOs and NPCs, Mothibi said.
He claimed that the SIU would utilize “quickly” for the Presidential Proclamation, initially granted in Oct 2020 to investigate corruption involving lottery grants, being prolonged to incorporate procurement by the NLC.
The SIU investigation had so far resulted in thirteen disciplinary referrals to the NLC, and administrative referrals to SARS and the Companies and Intellectual Houses Commission to blacklist men and women implicated during the looting. Complaints involving two folks had been referred into the Lawful Practice Council as well as the SA Institute of Chartered Accountants.
The SIU experienced noticed quite a few traits underneath the past NLC board and executive - many of whom are implicated in looting - Mothibi instructed MPs.
This involved a “development of collusion amongst NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “normal maladministration from the approval of grants,” he stated.
Sluggish development via the NPA
The SIU has frozen residences, Houses, automobiles and various assets worth tens of tens of millions that were bought with lottery money, but MPs expressed worry at gradual development in prosecuting Those people involved in the looting. (The SIU is mandated only to recover belongings acquired with stolen condition money and does not have prosecuting powers).
Though the SIU has referred fifteen matters to the NPA, thus far only two individuals have been brought right before a courtroom. Two men appeared in court docket in Kimberley just lately in reference to misappropriated funds gathered for a challenge to fight gender-based violence.
In August 2022 Christopher Tshivule was sentenced to 8 decades in prison for his aspect in a R1.5-million lottery grant fraud. Expenses from two people charged with him, who the SIU has called “kingpins” within the corruption that overwhelmed the NLC, had been dropped.
Main-Standard Mmeli Makinyane, the acting divisional commissioner for priority offences, informed MPs that the Hawks were presently investigating sixteen lottery corruption-related cases. A further just one - the Kimberley subject - is ahead of a court docket and two are actually sent to your NPA for a decision to prosecute. An additional 5 scenarios are being investigated by the SAPS detective and forensic providers, he stated.
Conveying the reasons for that hold off in prosecutions, NPA Deputy Countrywide Director Rodney de Kock mentioned part of The key reason why was that the Hawks needed to do more investigations when they obtained dossiers with the SIU.
“In essence, the investigations carried out by the SIU don't satisfy legal expectations for prosecutions.”
Therefore, the NPA experienced to work with investigators during the DPCI (the Hawks) and SAPS to carry out criminal investigations and make certain that the proof fulfills criminal prosecution criteria, he explained, adding: “Having said that, the perform of your SIU is vital and contributes enormously to this method.”
De Kock said that the SIU’s investigation “generally brings about numerous referrals. The referrals may possibly finally result in a single docket and a single court circumstance.”
He reported that twelve matters, which can be “around eighty five% finish”, have been remaining jointly investigated because of the Hawks along with the SIU’s Specialised Economic Operations Device. (The majority of these circumstances, 7 of which had been lodged in 2020, require previous NLC chief working officer Phillemon Letwaba, who resigned less than a cloud in 2022, and Pretoria lawyer Leslie Ramulifho.)
De Kock explained the NPA confronted quite a few “worries” in prosecuting scenarios. These, he claimed, integrated
the lapse of time among if the offences were being fully commited and also the issuing on the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary evidence” (Before this calendar year, the SIU explained to the committee that key files desired in some prosecutions had been deleted in the NLC Computer system procedure or experienced absent lacking from Metrofile, a warehouse wherever copies of paperwork are archived and saved);
The point that some implicated persons are still used by NLC; and
A problem into the legality on the Presidential Proclamation by former NLC chairperson Alfred Nevhutanda.
“The NPA is devoted to making certain finalisation in these issues. To this stop, a staff of focused prosecutors has actually been allotted to supervise all NLC issues presently beneath investigation,” de Kock claimed. “Matters are handled as being a priority. As soon as [the] investigations are finished, the NPA could make a decision.”
What the businesses say (or don’t)
GroundUp was only capable to get comment from one of the 5 providers accused because of the SIU in Parliament of producing fraudulent annual economical statements,TTP Consulting.
Aubrey Moeng, amongst TTP’s two directors, stated within an e-mail in reaction to inquiries: “On account of client confidentiality, we would like to recommend that TTP Consulting just isn't ready to disclose customers’ money private details with the public or media … without the consent with the shopper or perhaps a legal purpose.”
The business can be a “spouse” of many state entities, such as SARS and also the CIPC, Based on its Web site.
Neither of The 2 directors of Dzata Accountants, that are the two mentioned as inactive about the CIPC sign up of firms, responded to emailed questions. The corporate continues to be deregistered via the CIPC for failing to submit fiscal statements since 2021.
The only director of Mageba Ntuli Buying and selling and Consulting Company, Patrick Zulu, died a few many years ago, In line with official information. The business was deregistered because of the CIPC for failing to post fiscal statements since 2021.
Matamela Magodi, the only real director of Magodi Consultants, didn't respond to questions emailed to him.
GroundUp was unable to obtain any listing for Tafta Consulting and Accounting Products and services Along with the CIPC. We had been also struggling to trace any of the business’s administrators to ask for remark.