The Unique Investigating Unit has determined five accounting firms that aided loot Lottery funds. Graphic: Lisa Nelson
The Unique Investigating Device has identified 5 accounting and auditing firms that helped non-financial gain organizations loot Lottery dollars supposed for “great leads to”.
The accounting firms compiled fraudulent money statements utilized by these organizations to make an application for Lottery funding, the SIU told Parliament.
Performing Main national investigations officer Zodwa Xesibe said the SIU would get action to obtain these firms blacklisted.
A four-calendar year probe by the ตรวจ Special Investigating Unit (SIU) has uncovered five accounting and auditing firms that aided dodgy non-income corporations loot many hundreds of many rands intended for “excellent results in” from your Lottery.
These companies ended up described via the SIU as “Expert enablers,” who “compiled fraudulent economical statements” which were used by the businesses to make an application for Lottery funding.
The five companies have been named in Parliament with the SIU’s performing chief nationwide investigations officer Zodwa Xesibe. They're TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Expert services.
Fraudulent financials made by these five accounting companies assisted practically 40 organizations get their hands on lottery funding, based on the SIU presentation.
Based upon a Resource that contains data with all lottery grants considering the fact that 2002, these corporations acquired in excess of R314-million in funding.
“These NPCs have been funded via the Countrywide Lotteries Fee (NLC) though the resources were not employed for his or her intended reason,” Xesibe explained to Parliament’s Trade, Market and Level of competition Portfolio Committee very last week.
The SIU, the Hawks and the Nationwide Prosecuting Authority (NPA) were in Parliament to report to the committee on development in bringing individuals and organisations associated with looting the lottery to e-book.
Xesibe explained to GroundUp that the SIU intended to lodge problems towards the accounting companies associated and was checking if these firms have been registered and, if so, with which Specialist bodies.
“We wish these providers to be blacklisted,” she informed GroundUp.
To qualify for Lottery funding, an organisation was required to generate two many years of annual financial statements, Xesibe defined in Parliament.
Even so, as an ongoing six-calendar year investigation into lottery corruption by GroundUp has discovered, hijacked non-income organisations (NPOs) or new shelf non-earnings providers (NPCs) without monetary observe documents had been utilized to apply for funding.
In some cases, Just about equivalent money statements ended up generated for unrelated organisations, generally with just the names in the organisations modified, GroundUp’s investigation discovered.
Documents submitted by authentic NPCs for unsuccessful grant applications were being typically used by new or hijacked NPCs and NPOs to submit an application for funding. The details and paperwork from the unsuccessful applicants ended up supplied by senior Lottery officials to your dodgy applicants.
With cursory or - frequently - no verification, these dodgy applicants have been awarded millions of rands in grants. At times more tranches of resources were paid out without having Substantially examining to the development of initiatives.
The overwhelming majority of those grants ended up manufactured through proactive funding, which was at the heart of the looting of the lottery. Proactive funding authorized the Minister of Trade, Sector and Levels of competition, or even the NLC in conjunction with its board, to detect will cause to fund without having to start with 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 reported the SIU was at present investigating grants valued at about R2-billion, and the unit was nevertheless on a regular basis obtaining idea-offs about extra corruption.
He told MPs which the SIU’s investigation were damaged into three phases: the initial, which has been finalised, probed dodgy grants amounting to R280-million, and the 2nd, also done, included R247-million. While in the third section, resulting from be finalised at the conclusion of the yr, the SIU is investigating grants valued at Practically R906-million, involving 40 NPOs and NPCs, Mothibi mentioned.
He stated that the SIU would implement “quickly” for your Presidential Proclamation, at first granted in Oct 2020 to investigate corruption involving lottery grants, to be prolonged to include procurement via the NLC.
The SIU investigation had to date led to 13 disciplinary referrals for the NLC, and administrative referrals to SARS and the businesses and Mental Attributes Commission to blacklist folks implicated during the looting. Grievances involving two men and women were referred to the Legal Apply Council as well as SA Institute of Chartered Accountants.
The SIU experienced noticed numerous tendencies beneath the earlier NLC board and government - many of whom are already implicated in looting - Mothibi instructed MPs.
This provided a “trend of collusion between NLC officers and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “common maladministration during the approval of grants,” he explained.
Gradual development through the NPA
The SIU has frozen houses, properties, cars as well as other belongings worthy of tens of thousands and thousands which were bought with lottery cash, but MPs expressed worry at gradual development in prosecuting People linked to the looting. (The SIU is mandated only to Get well property purchased with stolen condition money and does not have prosecuting powers).
When the SIU has referred fifteen issues to your NPA, up to now only two folks have been introduced just before a courtroom. Two Adult males appeared in court in Kimberley recently in connection with misappropriated resources gathered for a venture to combat gender-based violence.
In August 2022 Christopher Tshivule was sentenced to 8 several years in jail for his part in a very R1.5-million lottery grant fraud. Rates versus two people charged with him, who the SIU has referred to as “kingpins” within the corruption that overcome the NLC, were being dropped.
Main-Standard Mmeli Makinyane, the acting divisional commissioner for priority offences, advised MPs the Hawks ended up presently investigating 16 lottery corruption-connected situations. A further one - the Kimberley matter - is right before a courtroom and two are sent to the NPA for a choice to prosecute. A further 5 situations are being investigated by the SAPS detective and forensic products and services, he claimed.
Describing The explanations for the hold off in prosecutions, NPA Deputy Countrywide Director Rodney de Kock explained Portion of the reason was the Hawks needed to do more investigations once they obtained dossiers with the SIU.
“In essence, the investigations carried out via the SIU don't satisfy legal criteria for prosecutions.”
Hence, the NPA experienced to operate with investigators during the DPCI (the Hawks) and SAPS to conduct criminal investigations and be sure that the evidence meets legal prosecution expectations, he said, introducing: “That said, the do the job on the SIU is very important and contributes significantly to this method.”
De Kock said that the SIU’s investigation “generally results in a number of referrals. The referrals may perhaps ultimately end in a single docket and one courtroom circumstance.”
He mentioned that 12 matters, which are “roughly 85% full”, have been currently being jointly investigated through the Hawks plus the SIU’s Specialised Economic Operations Device. (These types of scenarios, seven of which have been lodged in 2020, entail former NLC Main running officer Phillemon Letwaba, who resigned beneath a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)
De Kock reported the NPA faced quite a few “issues” in prosecuting instances. These, he reported, integrated
the lapse of time concerning when the offences had been dedicated and the issuing on the Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary proof” (Before this calendar year, the SIU explained to the committee that important documents required in some prosecutions had been deleted from your NLC Personal computer technique or had gone lacking from Metrofile, a warehouse wherever copies of paperwork are archived and stored);
The point that some implicated individuals remain utilized by NLC; and
A problem to the legality of your Presidential Proclamation by former NLC chairperson Alfred Nevhutanda.
“The NPA is dedicated to ensuring finalisation in these matters. To this close, a group of committed prosecutors continues to be allocated to oversee all NLC matters at this time under investigation,” de Kock mentioned. “Issues are managed as a priority. As soon as [the] investigations are finished, the NPA can make a call.”
What the businesses say (or don’t)
GroundUp was only ready to get remark from one of the 5 firms accused with the SIU in Parliament of manufacturing fraudulent annual financial statements,TTP Consulting.
Aubrey Moeng, certainly one of TTP’s two administrators, explained within an e-mail in reaction to inquiries: “On account of consumer confidentiality, we wish to suggest that TTP Consulting just isn't prepared to divulge consumers’ financial confidential information and facts with the general public or media … without the consent in the customer or perhaps a authorized motive.”
The company is really a “spouse” of many condition entities, like SARS as well as CIPC, Based on its Site.
Neither of The 2 directors of Dzata Accountants, who're each listed as inactive to the CIPC register of providers, responded to emailed inquiries. The company has been deregistered with the CIPC for failing to post financial statements given that 2021.
The only director of Mageba Ntuli Investing and Consulting Service, Patrick Zulu, died three a long time in the past, In line with Formal data. The corporate was deregistered via the CIPC for failing to post economical statements because 2021.
Matamela Magodi, the only real director of Magodi Consultants, did not respond to issues emailed to him.
GroundUp was not able to uncover any listing for Tafta Consulting and Accounting Providers With all the CIPC. We were also not able to trace any of the organization’s administrators to request comment.