The accountants who helped loot the Lottery

The accountants who helped loot the Lottery

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The Specific Investigating Device has determined 5 accounting firms that served loot Lottery resources. Graphic: Lisa Nelson

The Particular Investigating Device has recognized five accounting and auditing corporations that assisted non-revenue providers loot Lottery dollars intended for “very good leads to”.
The accounting firms compiled fraudulent financial statements utilized by these providers to submit an application for Lottery funding, the SIU instructed Parliament.
Performing Main countrywide investigations officer Zodwa Xesibe stated the SIU would get action to obtain these corporations blacklisted.
A 4-12 months probe because of the ตรวจ สลาก Unique Investigating Unit (SIU) has uncovered five accounting and auditing firms that helped dodgy non-profit businesses loot hundreds of a lot of rands intended for “great results in” through the Lottery.

These corporations had been explained through the SIU as “Qualified enablers,” who “compiled fraudulent monetary statements” that were used by the companies to make an application for Lottery funding.

The 5 corporations were named in Parliament with the SIU’s acting chief nationwide investigations officer Zodwa Xesibe. They may be TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Solutions.

Fraudulent financials made by these 5 accounting corporations served almost forty firms get their arms on lottery funding, according to the SIU presentation.

Based on a tool containing details with all lottery grants because 2002, these companies obtained around R314-million in funding.

“These NPCs ended up funded with the Countrywide Lotteries Commission (NLC) even so the money weren't used for his or her supposed objective,” Xesibe informed Parliament’s Trade, Business and Level of competition Portfolio Committee final 7 days.

The SIU, the Hawks plus 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 reserve.

Xesibe told GroundUp which the SIU intended to lodge complaints towards the accounting firms associated and was checking if these firms had been registered and, If that is so, with which Specialist bodies.

“We would like these businesses being blacklisted,” she told GroundUp.

To qualify for Lottery funding, an organisation was required to produce two years of annual economical statements, Xesibe described in Parliament.

However, being an ongoing 6-12 months investigation into lottery corruption by GroundUp has exposed, hijacked non-earnings organisations (NPOs) or new shelf non-profit firms (NPCs) with no financial observe documents have been accustomed to submit an application for funding.

In certain instances, Virtually similar economical statements were made for unrelated organisations, typically with only the names on the organisations improved, GroundUp’s investigation found.

Files submitted by real NPCs for unsuccessful grant purposes had been usually used by new or hijacked NPCs and NPOs to apply for funding. The details and paperwork on the unsuccessful applicants have been equipped by senior Lottery officials to your dodgy applicants.

With cursory or - frequently - no verification, these dodgy applicants ended up awarded an incredible number of rands in grants. Occasionally added tranches of money ended up paid out out with no A great deal checking within the progress of projects.

The vast majority of these grants had been created by way of proactive funding, which was at the guts with the looting from the lottery. Proactive funding permitted the Minister of Trade, Market and Competitiveness, or maybe the NLC at the side of its board, to determine will cause to fund with out initial requiring an application. This was stopped each time a new NLC board was appointed.

R2-billion in grants underneath investigation
SIU head Advocate Andy Mothibi claimed the SIU was at this time investigating grants valued at about R2-billion, along with the unit was nevertheless often getting tip-offs about extra corruption.

He instructed MPs that the SIU’s investigation had been damaged into three phases: the very first, that has been finalised, probed dodgy grants amounting to R280-million, and the next, also finished, associated R247-million. While in the 3rd section, due to be finalised at the end of the 12 months, the SIU is investigating grants valued at Nearly R906-million, involving 40 NPOs and NPCs, Mothibi reported.

He mentioned that the SIU would use “quickly” with the Presidential Proclamation, originally granted in Oct 2020 to analyze corruption involving lottery grants, to generally be prolonged to incorporate procurement via the NLC.

The SIU investigation experienced to this point brought about 13 disciplinary referrals to the NLC, and administrative referrals to SARS and the businesses and Mental Qualities Fee to blacklist people today implicated in the looting. Issues involving two individuals were referred on the Legal Follow Council as well as the SA Institute of Chartered Accountants.

The SIU experienced observed various developments underneath the former NLC board and government - most of whom are implicated in looting - Mothibi advised MPs.

This involved a “pattern of collusion amongst NLC officers and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “common maladministration during the acceptance of grants,” he reported.

Slow development through the NPA
The SIU has frozen properties, Houses, cars and trucks and other belongings truly worth tens of tens of millions which were bought with lottery resources, but MPs expressed problem at gradual development in prosecuting Individuals involved with the looting. (The SIU is mandated only to Recuperate property acquired with stolen point out funds and does not have prosecuting powers).

When the SIU has referred 15 matters on the NPA, so far only two people have been brought ahead of a court docket. Two Gentlemen appeared in court docket in Kimberley lately in connection with misappropriated money collected for any venture to beat gender-primarily based violence.

In August 2022 Christopher Tshivule was sentenced to 8 several years in jail for his element inside of a R1.5-million lottery grant fraud. Costs towards two people today billed with him, who the SIU has referred to as “kingpins” inside the corruption that overwhelmed the NLC, were being dropped.

Big-Standard Mmeli Makinyane, the acting divisional commissioner for precedence offences, explained to MPs which the Hawks were being currently investigating sixteen lottery corruption-connected instances. An additional a person - the Kimberley issue - is prior to a court docket and two are sent to your NPA for a call to prosecute. An additional 5 instances are increasingly being investigated by the SAPS detective and forensic companies, he explained.

Outlining the reasons for your hold off in prosecutions, NPA Deputy Countrywide Director Rodney de Kock mentioned A part of the reason was the Hawks had to do even further investigations whenever they received dossiers within the SIU.

“In essence, the investigations carried out through the SIU never satisfy prison requirements for prosecutions.”

Thus, the NPA experienced to operate with investigators during the DPCI (the Hawks) and SAPS to conduct criminal investigations and be certain that the proof fulfills felony prosecution benchmarks, he explained, incorporating: “That said, the get the job done of your SIU is essential and contributes significantly to this method.”

De Kock stated that the SIU’s investigation “usually leads to numerous referrals. The referrals may ultimately bring about one particular docket and a single court scenario.”

He explained that twelve issues, which might be “approximately 85% finish”, have been remaining jointly investigated with the Hawks and the SIU’s Specialised Financial Operations Unit. (The majority of these cases, seven of which were lodged in 2020, entail previous NLC chief operating officer Phillemon Letwaba, who resigned below a cloud in 2022, and Pretoria attorney Leslie Ramulifho.)

De Kock explained the NPA faced numerous “troubles” in prosecuting scenarios. These, he claimed, bundled

the lapse of time in between in the event the offences ended up dedicated plus the issuing with the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary proof” (Earlier this 12 months, the SIU informed the committee that key paperwork desired in a few prosecutions had been deleted from the NLC Computer system program or experienced long gone lacking from Metrofile, a warehouse in which copies of paperwork are archived and stored);
the fact that some implicated persons remain employed by NLC; and
A challenge for the legality with the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is devoted to guaranteeing finalisation in these issues. To this conclusion, a workforce of dedicated prosecutors continues to be allocated to supervise all NLC issues currently below investigation,” de Kock said. “Matters are managed like a precedence. Once [the] investigations are concluded, the NPA will make a choice.”

What the businesses say (or don’t)
GroundUp was only capable of get remark from one of several 5 organizations accused from the SIU in Parliament of producing fraudulent annual economic statements,TTP Consulting.

Aubrey Moeng, considered one of TTP’s two administrators, said within an electronic mail in reaction to thoughts: “Because of consumer confidentiality, we desire to suggest that TTP Consulting is just not prepared to disclose shoppers’ economical confidential details with the general public or media … with no consent of the shopper or possibly a authorized purpose.”

The organization is really a “partner” of various point out entities, like SARS and the CIPC, In line with its Web-site.

Neither of the two directors of Dzata Accountants, that are both stated as inactive over the CIPC register of organizations, responded to emailed queries. The business has actually been deregistered because of the CIPC for failing to submit monetary statements given that 2021.

The sole director of Mageba Ntuli Investing and Consulting Assistance, Patrick Zulu, died three decades in the past, In accordance with Formal information. The corporation was deregistered through the CIPC for failing to post financial statements due to the fact 2021.

Matamela Magodi, the only real director of Magodi Consultants, didn't reply to questions emailed to him.

GroundUp was unable to uncover any listing for Tafta Consulting and Accounting Services With all the CIPC. We ended up also not able to trace any of the business’s directors to request remark.

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