The accountants who helped loot the Lottery
The accountants who helped loot the Lottery
Blog Article
The Particular Investigating Device has determined 5 accounting companies that served loot Lottery funds. Graphic: Lisa Nelson
The Distinctive Investigating Unit has recognized five accounting and auditing companies that aided non-revenue providers loot Lottery funds meant for “fantastic causes”.
The accounting firms compiled fraudulent financial statements used by these businesses to apply for Lottery funding, the SIU told Parliament.
Performing chief national investigations officer Zodwa Xesibe said the SIU would take motion to get these firms blacklisted.
A 4-yr probe by the หุ้น ชอง 9 Unique Investigating Unit (SIU) has uncovered 5 accounting and auditing companies that helped dodgy non-revenue businesses loot a huge selection of millions of rands designed for “fantastic triggers” in the Lottery.
These corporations had been explained through the SIU as “professional enablers,” who “compiled fraudulent fiscal statements” which were used by the companies to submit an application for Lottery funding.
The 5 businesses ended up named in Parliament by the SIU’s acting chief national investigations officer Zodwa Xesibe. They can be TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Products and services.
Fraudulent financials made by these 5 accounting companies assisted virtually 40 firms get their fingers on lottery funding, according to the SIU presentation.
According to a Instrument containing info with all lottery grants considering the fact that 2002, these corporations obtained over R314-million in funding.
“These NPCs were funded by the Nationwide Lotteries Commission (NLC) though the money weren't used for their supposed reason,” Xesibe informed Parliament’s Trade, Industry and Competition Portfolio Committee previous 7 days.
The SIU, the Hawks plus the Nationwide Prosecuting Authority (NPA) were being in Parliament to report to the committee on development in bringing men and women and organisations associated with looting the lottery to reserve.
Xesibe instructed GroundUp that the SIU intended to lodge problems in opposition to the accounting corporations involved and was examining if these companies ended up registered and, If that's so, with which professional bodies.
“We wish these corporations to get blacklisted,” she informed GroundUp.
To qualify for Lottery funding, an organisation was needed to generate two many years of once-a-year monetary statements, Xesibe defined in Parliament.
Even so, as an ongoing six-year investigation into lottery corruption by GroundUp has disclosed, hijacked non-gain organisations (NPOs) or new shelf non-financial gain organizations (NPCs) without having economical keep track of data were being utilized to make an application for funding.
In a few occasions, Just about equivalent monetary statements have been manufactured for unrelated organisations, frequently with only the names from the organisations changed, GroundUp’s investigation observed.
Documents submitted by authentic NPCs for unsuccessful grant purposes were being normally used by new or hijacked NPCs and NPOs to make an application for funding. The details and documents of the unsuccessful applicants had been supplied by senior Lottery officers for the dodgy applicants.
With cursory or - often - no verification, these dodgy applicants were being awarded a lot of rands in grants. At times supplemental tranches of cash had been paid out out without Significantly examining to the development of projects.
The overwhelming majority of these grants had been manufactured through proactive funding, which was at the center in the looting in the lottery. Proactive funding allowed the Minister of Trade, Sector and Competition, or maybe the NLC in conjunction with its board, to identify causes to fund without the need of initially requiring an application. This was stopped any time a new NLC board was appointed.
R2-billion in grants beneath investigation
SIU head Advocate Andy Mothibi said the SIU was at the moment investigating grants valued at above R2-billion, and the unit was nevertheless on a regular basis receiving tip-offs about additional corruption.
He instructed MPs the SIU’s investigation had been broken into a few phases: the main, that has been finalised, probed dodgy grants amounting to R280-million, and the second, also completed, associated R247-million. From the third section, as a consequence of be finalised at the end of the calendar year, the SIU is investigating grants valued at Practically R906-million, involving 40 NPOs and NPCs, Mothibi claimed.
He stated the SIU would apply “quickly” with the Presidential Proclamation, originally granted in October 2020 to analyze corruption involving lottery grants, to become extended to include procurement because of the NLC.
The SIU investigation experienced up to now brought about thirteen disciplinary referrals to your NLC, and administrative referrals to SARS and the businesses and Mental Houses Fee to blacklist persons implicated during the looting. Problems involving two people today were referred on the Authorized Apply Council and also the SA Institute of Chartered Accountants.
The SIU experienced observed numerous trends underneath the earlier NLC board and executive - most of whom have been implicated in looting - Mothibi explained to MPs.
This bundled a “craze of collusion among NLC officers and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “common maladministration from the acceptance of grants,” he mentioned.
Sluggish development from the NPA
The SIU has frozen properties, Houses, cars and trucks along with other property value tens of tens of millions which were purchased with lottery money, but MPs expressed problem at slow development in prosecuting Those people linked to the looting. (The SIU is mandated only to Get well assets acquired with stolen condition funds and doesn't have prosecuting powers).
Even though the SIU has referred 15 issues for the NPA, so far only two folks have been brought in advance of a court. Two Adult males appeared in court in Kimberley recently in connection with misappropriated resources gathered for any challenge to fight gender-dependent violence.
In August 2022 Christopher Tshivule was sentenced to 8 many years in prison for his portion inside of a R1.five-million lottery grant fraud. Charges towards two men and women charged with him, who the SIU has referred to as “kingpins” while in the corruption that overcome the NLC, have been dropped.
Key-Standard Mmeli Makinyane, the acting divisional commissioner for precedence offences, explained to MPs the Hawks have been at present investigating sixteen lottery corruption-similar scenarios. One more 1 - the Kimberley matter - is in advance of a court and two are actually sent on the NPA for a call to prosecute. A further five conditions are being investigated with the SAPS detective and forensic services, he mentioned.
Conveying The explanations with the hold off in prosecutions, NPA Deputy Countrywide Director Rodney de Kock said A part of The explanation was the Hawks had to do additional investigations once they obtained dossiers in the SIU.
“In essence, the investigations carried out because of the SIU will not satisfy prison criteria for prosecutions.”
For that reason, the NPA had to work with investigators in the DPCI (the Hawks) and SAPS to carry out prison investigations and be sure that the evidence fulfills felony prosecution requirements, he claimed, adding: “That said, the operate of your SIU is very important and contributes considerably to this method.”
De Kock said that the SIU’s investigation “frequently leads to several referrals. The referrals may possibly eventually cause one particular docket and one particular courtroom case.”
He said that twelve matters, that are “approximately eighty five% full”, were remaining jointly investigated with the Hawks and also the SIU’s Specialised Financial Operations Unit. (A large number of circumstances, 7 of which were lodged in 2020, entail previous NLC Main operating officer Phillemon Letwaba, who resigned beneath a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)
De Kock claimed the NPA faced numerous “problems” in prosecuting circumstances. These, he stated, integrated
the lapse of your time amongst when the offences were being dedicated as well as the issuing of the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary proof” (Earlier this 12 months, the SIU informed the committee that critical documents essential in certain prosecutions had been deleted from your NLC computer program or experienced long gone lacking from Metrofile, a warehouse where copies of documents are archived and stored);
The truth that some implicated persons remain used by NLC; and
A problem to your legality of your Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is devoted to making certain finalisation in these matters. To this finish, a team of focused prosecutors has long been allotted to oversee all NLC issues at the moment below investigation,” de Kock said. “Issues are dealt with to be a priority. Once [the] investigations are done, the NPA can make a call.”
What the companies say (or don’t)
GroundUp was only in the position to get comment from among the list of 5 organizations accused via the SIU in Parliament of producing fraudulent annual fiscal statements,TTP Consulting.
Aubrey Moeng, amongst TTP’s two directors, stated in an e-mail in response to queries: “Resulting from shopper confidentiality, we need to recommend that TTP Consulting is not really prepared to disclose consumers’ economic confidential information with the general public or media … without the consent of the shopper or possibly a legal rationale.”
The corporate can be a “companion” of quite a few state entities, together with SARS along with the CIPC, according to its Web page.
Neither of The 2 directors of Dzata Accountants, who're equally mentioned as inactive around the CIPC sign-up of corporations, responded to emailed questions. The organization has become deregistered with the CIPC for failing to submit fiscal statements due to the fact 2021.
The only director of Mageba Ntuli Buying and selling and Consulting Services, Patrick Zulu, died three decades in the past, In line with official documents. The corporate was deregistered through the CIPC for failing to post fiscal statements given that 2021.
Matamela Magodi, the only real director of Magodi Consultants, did not reply to questions emailed to him.
GroundUp was not able to find any listing for Tafta Consulting and Accounting Expert services Using the CIPC. We ended up also struggling to trace any of the organization’s directors to ask for comment.