The Distinctive Investigating Device has identified 5 accounting firms that assisted loot Lottery funds. Graphic: Lisa Nelson
The Specific Investigating Device has determined 5 accounting and auditing companies that aided non-financial gain companies loot Lottery cash supposed for “superior will cause”.
The accounting firms compiled fraudulent economical statements used by these corporations to make an application for Lottery funding, the SIU informed Parliament.
Performing chief nationwide investigations officer Zodwa Xesibe claimed the SIU would get motion to obtain these corporations blacklisted.
A 4-calendar year probe with the fox888 Specific Investigating Device (SIU) has uncovered five accounting and auditing companies that assisted dodgy non-financial gain companies loot numerous an incredible number of rands intended for “very good will cause” within the Lottery.
These corporations ended up explained via the SIU as “Skilled enablers,” who “compiled fraudulent money statements” that were used by the companies to make an application for Lottery funding.
The 5 firms have been named in Parliament with the SIU’s acting chief countrywide investigations officer Zodwa Xesibe. They are TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Solutions.
Fraudulent financials made by these 5 accounting companies assisted practically forty providers get their palms on lottery funding, according to the SIU presentation.
Dependant on a Instrument that contains info with all lottery grants since 2002, these corporations received about R314-million in funding.
“These NPCs had been funded from the National Lotteries Fee (NLC) but the resources were not employed for their intended reason,” Xesibe explained to Parliament’s Trade, Industry and Level of competition Portfolio Committee last 7 days.
The SIU, the Hawks as well as Nationwide Prosecuting Authority (NPA) were being in Parliament to report back to the committee on development in bringing folks and organisations involved with looting the lottery to ebook.
Xesibe advised GroundUp the SIU intended to lodge complaints against the accounting companies involved and was examining if these companies were registered and, If that's so, with which Qualified bodies.
“We want these businesses to get blacklisted,” she informed GroundUp.
To qualify for Lottery funding, an organisation was required to make two decades of annual monetary statements, Xesibe defined in Parliament.
Having said that, as an ongoing six-yr investigation into lottery corruption by GroundUp has disclosed, hijacked non-profit organisations (NPOs) or new shelf non-earnings corporations (NPCs) without financial keep track of documents had been accustomed to apply for funding.
In certain scenarios, Pretty much equivalent financial statements were being generated for unrelated organisations, generally with only the names of your organisations modified, GroundUp’s investigation observed.
Documents submitted by real NPCs for unsuccessful grant apps ended up frequently utilized by new or hijacked NPCs and NPOs to submit an application for funding. The main points and documents from the unsuccessful applicants had been supplied by senior Lottery officers on the dodgy applicants.
With cursory or - generally - no verification, these dodgy applicants had been awarded an incredible number of rands in grants. At times added tranches of funds were being paid out out without having Significantly checking over the development of initiatives.
The overwhelming majority of these grants were being manufactured via proactive funding, which was at the heart with the looting on the lottery. Proactive funding authorized the Minister of Trade, Market and Opposition, or perhaps the NLC in conjunction with its board, to recognize will cause to fund with out very first requiring an application. 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 now investigating grants valued at in excess of R2-billion, and also the device was nonetheless on a regular basis receiving suggestion-offs about a lot more corruption.
He explained to MPs which the SIU’s investigation were damaged into three phases: the primary, which has been finalised, probed dodgy grants amounting to R280-million, and the next, also done, concerned R247-million. While in the third stage, due to be finalised at the end of the calendar year, the SIU is investigating grants valued at Virtually R906-million, involving 40 NPOs and NPCs, Mothibi mentioned.
He stated the SIU would use “quickly” to the Presidential Proclamation, initially granted in October 2020 to research corruption involving lottery grants, to become prolonged to incorporate procurement from the NLC.
The SIU investigation experienced so far brought about thirteen disciplinary referrals towards the NLC, and administrative referrals to SARS and the businesses and Mental Qualities Commission to blacklist folks implicated from the looting. Complaints involving two folks had been referred to your Legal Apply Council and the SA Institute of Chartered Accountants.
The SIU had noticed quite a few developments under the past NLC board and govt - most of whom happen to be implicated in looting - Mothibi advised MPs.
This provided a “pattern of collusion amongst NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “general maladministration during the approval of grants,” he said.
Gradual progress because of the NPA
The SIU has frozen houses, Houses, automobiles together with other assets value tens of millions that were purchased with lottery resources, but MPs expressed problem at sluggish development in prosecuting those involved with the looting. (The SIU is mandated only to Get better belongings purchased with stolen condition money and does not have prosecuting powers).
When the SIU has referred fifteen issues into the NPA, so far only two folks have been introduced right before a court. Two Adult men appeared in courtroom in Kimberley not too long ago in connection with misappropriated resources gathered for any venture to beat gender-dependent violence.
In August 2022 Christopher Tshivule was sentenced to eight yrs in prison for his aspect in the R1.five-million lottery grant fraud. Expenses versus two persons billed with him, who the SIU has described as “kingpins” inside the corruption that overcome the NLC, were being dropped.
Big-Typical Mmeli Makinyane, the performing divisional commissioner for priority offences, informed MPs that the Hawks have been at this time investigating 16 lottery corruption-linked conditions. An additional just one - the Kimberley make any difference - is before a court docket and two are actually sent to the NPA for a call to prosecute. An additional 5 situations are being investigated because of the SAPS detective and forensic companies, he said.
Outlining the reasons for that hold off in prosecutions, NPA Deputy National Director Rodney de Kock mentioned part of The key reason why was that the Hawks had to do even further investigations once they gained dossiers from the SIU.
“In essence, the investigations undertaken because of the SIU do not satisfy legal benchmarks for prosecutions.”
As a result, the NPA experienced to operate with investigators within the DPCI (the Hawks) and SAPS to conduct criminal investigations and make certain that the evidence meets legal prosecution expectations, he claimed, adding: “That said, the get the job done of the SIU is significant and contributes enormously to this method.”
De Kock explained that the SIU’s investigation “often brings about a number of referrals. The referrals could ultimately cause a single docket and 1 court docket case.”
He reported that 12 matters, which can be “close to 85% comprehensive”, were being getting jointly investigated through the Hawks along with the SIU’s Specialised Economic Operations Unit. (Many of these scenarios, seven of which had been lodged in 2020, entail previous NLC chief operating officer Phillemon Letwaba, who resigned less than a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)
De Kock claimed the NPA faced a number of “problems” in prosecuting circumstances. These, he claimed, integrated
the lapse of your time concerning once the offences have been dedicated plus the issuing of your Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary proof” (Before this calendar year, the SIU explained to the committee that critical paperwork required in certain prosecutions had been deleted in the NLC Pc procedure or experienced gone lacking from Metrofile, a warehouse where by copies of paperwork are archived and saved);
The point that some implicated people today are still utilized by NLC; and
A challenge on the legality from the Presidential Proclamation by former NLC chairperson Alfred Nevhutanda.
“The NPA is devoted to making sure finalisation in these issues. To this stop, a group of focused prosecutors has become allotted to supervise all NLC issues now less than investigation,” de Kock said. “Issues are taken care of to be a precedence. At the time [the] investigations are done, the NPA could make a choice.”
What the companies say (or don’t)
GroundUp was only capable of get comment from among the 5 firms accused with the SIU in Parliament of producing fraudulent once-a-year fiscal statements,TTP Consulting.
Aubrey Moeng, one among TTP’s two administrators, explained within an email in response to concerns: “As a result of customer confidentiality, we want to suggest that TTP Consulting is not really willing to divulge clientele’ money private details with the public or media … without the consent on the customer or simply a lawful cause.”
The company is usually a “partner” of several point out entities, together with SARS as well as CIPC, according to its Web site.
Neither of The 2 directors of Dzata Accountants, who are both of those stated as inactive over the CIPC register of companies, responded to emailed issues. The business is deregistered via the CIPC for failing to submit money statements given that 2021.
The only real director of Mageba Ntuli Investing and Consulting Support, Patrick Zulu, died 3 decades back, In line with official information. The business was deregistered with the CIPC for failing to submit fiscal statements due to the fact 2021.
Matamela Magodi, the only director of Magodi Consultants, did not respond to concerns emailed to him.
GroundUp was unable to discover any listing for Tafta Consulting and Accounting Solutions With all the CIPC. We had been also unable to trace any of the company’s administrators to request comment.