The accountants who assisted loot the Lottery
The accountants who assisted loot the Lottery
Blog Article
The Distinctive Investigating Unit has discovered five accounting companies that assisted loot Lottery money. Graphic: Lisa Nelson
The Distinctive Investigating Device has identified five accounting and auditing firms that served non-earnings providers loot Lottery funds supposed for “good leads to”.
The accounting corporations compiled fraudulent economic statements used by these organizations to apply for Lottery funding, the SIU informed Parliament.
Performing chief nationwide investigations officer Zodwa Xesibe reported the SIU would consider motion to have these firms blacklisted.
A four-yr probe by the ruay Specific Investigating Unit (SIU) has exposed five accounting and auditing companies that aided dodgy non-profit organizations loot many many rands designed for “superior leads to” with the Lottery.
These corporations had been explained via the SIU as “Experienced enablers,” who “compiled fraudulent economical statements” that were used by the companies to submit an application for Lottery funding.
The five companies were named in Parliament by the SIU’s acting Main national investigations officer Zodwa Xesibe. They can be TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Companies.
Fraudulent financials made by these 5 accounting corporations assisted nearly 40 firms get their palms on lottery funding, in accordance with the SIU presentation.
Dependant on a Software made up of facts with all lottery grants since 2002, these businesses acquired in excess of R314-million in funding.
“These NPCs had been funded from the Countrywide Lotteries Commission (NLC) but the cash were not made use of for their supposed reason,” Xesibe advised Parliament’s Trade, Market and Competitors Portfolio Committee very last 7 days.
The SIU, the Hawks along with the Countrywide Prosecuting Authority (NPA) had been in Parliament to report back to the committee on development in bringing people and organisations associated with looting the lottery to e-book.
Xesibe instructed GroundUp the SIU intended to lodge grievances from the accounting corporations involved and was checking if these firms had been registered and, If that's so, with which professional bodies.
“We wish these corporations to get blacklisted,” she advised GroundUp.
To qualify for Lottery funding, an organisation was required to produce two decades of yearly monetary statements, Xesibe spelled out in Parliament.
Even so, being an ongoing 6-yr investigation into lottery corruption by GroundUp has discovered, hijacked non-revenue organisations (NPOs) or new shelf non-financial gain businesses (NPCs) without any fiscal keep track of information have been utilized to make an application for funding.
In certain situations, Just about equivalent monetary statements had been developed for unrelated organisations, generally with just the names of the organisations modified, GroundUp’s investigation observed.
Paperwork submitted by authentic NPCs for unsuccessful grant apps were frequently used by new or hijacked NPCs and NPOs to submit an application for funding. The main points and files in the unsuccessful applicants had been provided by senior Lottery officials for the dodgy applicants.
With cursory or - normally - no verification, these dodgy applicants were being awarded millions of rands in grants. Sometimes additional tranches of cash ended up paid out without the need of Substantially checking to the progress of assignments.
The overwhelming majority of these grants have been made by way of proactive funding, which was at the heart with the looting with the lottery. Proactive funding authorized the Minister of Trade, Field and Levels of competition, or perhaps the NLC along side its board, to identify leads to to fund without having initially demanding an application. This was stopped whenever a new NLC board was appointed.
R2-billion in grants below investigation
SIU head Advocate Andy Mothibi claimed the SIU was at this time investigating grants valued at in excess of R2-billion, plus the device was nevertheless often acquiring tip-offs about additional corruption.
He told MPs that the SIU’s investigation were damaged into a few phases: the initial, that has been finalised, probed dodgy grants amounting to R280-million, and the next, also done, associated R247-million. Within the third period, resulting from be finalised at the end of the year, the SIU is investigating grants valued at Virtually R906-million, involving 40 NPOs and NPCs, Mothibi mentioned.
He explained that the SIU would implement “before long” for the Presidential Proclamation, originally granted in Oct 2020 to research corruption involving lottery grants, being extended to incorporate procurement with the NLC.
The SIU investigation had so far triggered thirteen disciplinary referrals on the NLC, and administrative referrals to SARS and the businesses and Intellectual Qualities Fee to blacklist folks implicated during the looting. Complaints involving two men and women were referred to the Legal Apply Council plus the SA Institute of Chartered Accountants.
The SIU experienced noticed quite a few trends under the preceding NLC board and government - lots of whom happen to be implicated in looting - Mothibi instructed MPs.
This bundled a “craze of collusion involving NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “common maladministration within the acceptance of grants,” he mentioned.
Gradual progress because of the NPA
The SIU has frozen properties, Homes, cars along with other belongings well worth tens of millions that were purchased with lottery funds, but MPs expressed worry at slow progress in prosecuting Those people associated with the looting. (The SIU is mandated only to Get better belongings acquired with stolen point out resources and doesn't have prosecuting powers).
Whilst the SIU has referred 15 matters into the NPA, to this point only two folks have been introduced before a court docket. Two men appeared in court docket in Kimberley a short while ago in reference to misappropriated resources collected for the challenge to combat gender-based mostly violence.
In August 2022 Christopher Tshivule was sentenced to 8 decades in jail for his aspect in a R1.five-million lottery grant fraud. Expenses versus two men and women charged with him, who the SIU has referred to as “kingpins” within the corruption that overcome the NLC, were dropped.
Key-Common Mmeli Makinyane, the performing divisional commissioner for precedence offences, explained to MPs that the Hawks had been at the moment investigating sixteen lottery corruption-similar conditions. Another a single - the Kimberley issue - is prior to a court docket and two have been despatched on the NPA for a decision to prosecute. An extra five cases are being investigated because of the SAPS detective and forensic companies, he said.
Conveying the reasons for that hold off in prosecutions, NPA Deputy National Director Rodney de Kock claimed A part of The rationale was which the Hawks had to do additional investigations if they been given dossiers in the SIU.
“In essence, the investigations undertaken with the SIU never fulfill prison criteria for prosecutions.”
Hence, the NPA experienced to work with investigators in the DPCI (the Hawks) and SAPS to carry out legal investigations and make certain that the evidence fulfills criminal prosecution criteria, he explained, introducing: “That said, the perform of your SIU is vital and contributes greatly to this process.”
De Kock explained which the SIU’s investigation “frequently leads to various referrals. The referrals might eventually result in a single docket and just one courtroom situation.”
He mentioned that 12 issues, which happen to be “close to eighty five% comprehensive”, had been being jointly investigated by the Hawks and also the SIU’s Specialised Financial Functions Unit. (Many of these cases, 7 of which were lodged in 2020, entail previous NLC chief working officer Phillemon Letwaba, who resigned less than a cloud in 2022, and Pretoria lawyer Leslie Ramulifho.)
De Kock reported the NPA faced numerous “worries” in prosecuting instances. These, he explained, bundled
the lapse of time amongst in the event the offences were committed along with the issuing of your Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary proof” (Before this 12 months, the SIU instructed the committee that critical paperwork necessary in some prosecutions were deleted with the NLC Laptop or computer process or had long gone missing from Metrofile, a warehouse wherever copies of paperwork are archived and saved);
The truth that some implicated individuals are still utilized by NLC; and
A obstacle towards the legality with the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is committed to guaranteeing finalisation in these issues. To this finish, a crew of dedicated prosecutors has actually been allotted to supervise all NLC issues at present beneath investigation,” de Kock reported. “Issues are managed to be a precedence. At the time [the] investigations are done, the NPA could make a call.”
What the businesses say (or don’t)
GroundUp was only ready to get remark from one of several five providers accused because of the SIU in Parliament of manufacturing fraudulent annual financial statements,TTP Consulting.
Aubrey Moeng, amongst TTP’s two directors, reported in an e mail in reaction to queries: “Due to consumer confidentiality, we prefer to advise that TTP Consulting will not be prepared to disclose clientele’ money private info with the public or media … without the consent in the consumer or maybe a authorized motive.”
The corporation is a “husband or wife” of quite a few condition entities, like SARS as well as the CIPC, In accordance with its Web site.
Neither of The 2 administrators of Dzata Accountants, who're each stated as inactive around the CIPC sign-up of companies, responded to emailed inquiries. The company has become deregistered via the CIPC for failing to submit fiscal statements since 2021.
The only real director of Mageba Ntuli Trading and Consulting Services, Patrick Zulu, died three many years ago, In line with official data. The business was deregistered through the CIPC for failing to submit financial statements because 2021.
Matamela Magodi, the only real director of Magodi Consultants, did not respond to thoughts emailed to him.
GroundUp was not able to find any listing for Tafta Consulting and Accounting Products and services Along with the CIPC. We had been also not able to trace any of the company’s directors to request remark.