The accountants who assisted loot the Lottery
The accountants who assisted loot the Lottery
Blog Article
The Exclusive Investigating Unit has recognized five accounting companies that assisted loot Lottery resources. Graphic: Lisa Nelson
The Exclusive Investigating Unit has determined five accounting and auditing companies that assisted non-gain companies loot Lottery revenue intended for “fantastic brings about”.
The accounting firms compiled fraudulent financial statements utilized by these corporations to make an application for Lottery funding, the SIU explained to Parliament.
Acting chief nationwide investigations officer Zodwa Xesibe reported the SIU would take motion to possess these companies blacklisted.
A 4-yr probe by the hihuay Unique Investigating Unit (SIU) has exposed 5 accounting and auditing firms that helped dodgy non-financial gain companies loot numerous many rands designed for “good causes” through the Lottery.
These firms have been explained because of the SIU as “Expert enablers,” who “compiled fraudulent economic statements” that were used by the businesses to make an application for Lottery funding.
The five organizations ended up named in Parliament via the SIU’s performing chief national investigations officer Zodwa Xesibe. They are really TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Expert services.
Fraudulent financials made by these five accounting firms helped practically forty companies get their fingers on lottery funding, in accordance with the SIU presentation.
Determined by a Instrument that contains knowledge with all lottery grants because 2002, these firms obtained about R314-million in funding.
“These NPCs were funded because of the Countrywide Lotteries Fee (NLC) but the cash weren't utilised for their intended purpose,” Xesibe informed Parliament’s Trade, Business and Competitors Portfolio Committee past week.
The SIU, the Hawks and the Countrywide Prosecuting Authority (NPA) had been in Parliament to report back to the committee on development in bringing folks and organisations linked to looting the lottery to ebook.
Xesibe informed GroundUp the SIU intended to lodge issues versus the accounting corporations associated and was checking if these firms have been registered and, If that's so, with which Experienced bodies.
“We wish these firms to get blacklisted,” she advised GroundUp.
To qualify for Lottery funding, an organisation was required to develop two a long time of once-a-year fiscal statements, Xesibe explained in Parliament.
Nevertheless, being an ongoing 6-year investigation into lottery corruption by GroundUp has unveiled, hijacked non-revenue organisations (NPOs) or new shelf non-financial gain businesses (NPCs) without having monetary keep track of records ended up utilized to apply for funding.
In some situations, Virtually identical economic statements have been made for unrelated organisations, usually with only the names of your organisations improved, GroundUp’s investigation uncovered.
Paperwork submitted by genuine NPCs for unsuccessful grant apps had been normally used by new or hijacked NPCs and NPOs to submit an application for funding. The details and paperwork of the unsuccessful applicants have been equipped by senior Lottery officials for the dodgy applicants.
With cursory or - normally - no verification, these dodgy applicants were awarded an incredible number of rands in grants. Occasionally more tranches of funds have been paid out with no much checking within the development of projects.
The overwhelming majority of such grants were being produced by way of proactive funding, which was at the heart from the looting from the lottery. Proactive funding authorized the Minister of Trade, Marketplace and Competition, or maybe the NLC along side its board, to establish will cause to fund without having first necessitating an software. This was stopped when a new NLC board was appointed.
R2-billion in grants less than investigation
SIU head Advocate Andy Mothibi explained the SIU was at this time investigating grants valued at more than R2-billion, plus the device was nevertheless on a regular basis receiving suggestion-offs about a lot more corruption.
He explained to MPs that the SIU’s investigation had been damaged into a few phases: the 1st, which has been finalised, probed dodgy grants amounting to R280-million, and the 2nd, also concluded, concerned R247-million. Inside the third period, because of be finalised at the end of the 12 months, the SIU is investigating grants valued at almost R906-million, involving forty NPOs and NPCs, Mothibi said.
He said the SIU would apply “shortly” for your Presidential Proclamation, originally granted in Oct 2020 to research corruption involving lottery grants, for being prolonged to include procurement from the NLC.
The SIU investigation experienced to this point triggered 13 disciplinary referrals on the NLC, and administrative referrals to SARS and the businesses and Mental Qualities Commission to blacklist people implicated inside the looting. Issues involving two people had been referred towards the Legal Exercise Council as well as the SA Institute of Chartered Accountants.
The SIU experienced observed numerous developments underneath the former NLC board and government - many of whom have already been implicated in looting - Mothibi informed MPs.
This included a “craze of collusion in between NLC officers and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “common maladministration from the acceptance of grants,” he mentioned.
Gradual development through the NPA
The SIU has frozen residences, properties, automobiles as well as other property value tens of tens of millions which were acquired with lottery cash, but MPs expressed worry at sluggish progress in prosecuting These involved in the looting. (The SIU is mandated only to recover belongings purchased with stolen state resources and doesn't have prosecuting powers).
Although the SIU has referred 15 issues for the NPA, so far only two folks have been brought just before a court. Two Adult men appeared in courtroom in Kimberley recently in connection with misappropriated resources collected for the project to overcome gender-centered violence.
In August 2022 Christopher Tshivule was sentenced to eight several years in jail for his part within a R1.five-million lottery grant fraud. Prices versus two individuals charged with him, who the SIU has described as “kingpins” inside the corruption that overcome the NLC, have been dropped.
Key-Standard Mmeli Makinyane, the acting divisional commissioner for priority offences, told MPs which the Hawks had been now investigating 16 lottery corruption-linked cases. One more one - the Kimberley issue - is in advance of a court docket and two happen to be sent on the NPA for a choice to prosecute. An additional five situations are now being investigated with the SAPS detective and forensic expert services, he reported.
Conveying The explanations to the delay in prosecutions, NPA Deputy National Director Rodney de Kock said Element of The key reason why was the Hawks needed to do even more investigations after they received dossiers with the SIU.
“In essence, the investigations undertaken because of the SIU don't fulfill prison specifications for prosecutions.”
Hence, the NPA had to work with investigators from the DPCI (the Hawks) and SAPS to perform prison investigations and make certain that the proof fulfills felony prosecution criteria, he reported, adding: “Having said that, the work of the SIU is essential and contributes tremendously to this process.”
De Kock reported which the SIU’s investigation “typically leads to multiple referrals. The referrals may perhaps in the long run cause 1 docket and a person courtroom circumstance.”
He explained that twelve matters, which happen to be “about eighty five% full”, were being getting jointly investigated via the Hawks and also the SIU’s Specialised Financial Functions Device. (Most of these situations, seven of which have been lodged in 2020, contain previous NLC Main running officer Phillemon Letwaba, who resigned underneath a cloud in 2022, and Pretoria attorney Leslie Ramulifho.)
De Kock explained the NPA faced numerous “problems” in prosecuting circumstances. These, he mentioned, integrated
the lapse of your time involving if the offences had been fully commited along with the issuing in the Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary evidence” (Before this year, the SIU explained to the committee that crucial files required in a few prosecutions were deleted from your NLC Laptop or computer program or experienced long gone lacking from Metrofile, a warehouse where copies of documents are archived and stored);
The reality that some implicated people today remain used by NLC; and
A obstacle to the legality from the Presidential Proclamation by former NLC chairperson Alfred Nevhutanda.
“The NPA is committed to making sure finalisation in these issues. To this conclusion, a staff of committed prosecutors has actually been allocated to oversee all NLC issues at the moment beneath investigation,” de Kock mentioned. “Issues are dealt with as being a precedence. After [the] investigations are finished, the NPA could make a decision.”
What the businesses say (or don’t)
GroundUp was only capable of get remark from among the 5 companies accused with the SIU in Parliament of manufacturing fraudulent once-a-year economic statements,TTP Consulting.
Aubrey Moeng, amongst TTP’s two directors, stated in an e-mail in response to inquiries: “As a consequence of client confidentiality, we want to advise that TTP Consulting just isn't willing to divulge clients’ financial private information and facts with the general public or media … without the consent of the shopper or maybe a authorized reason.”
The corporation is often a “spouse” of several condition entities, such as SARS as well as CIPC, In line with its website.
Neither of the two directors of Dzata Accountants, that are both detailed as inactive to the CIPC sign up of businesses, responded to emailed inquiries. The corporation has been deregistered from the CIPC for failing to submit monetary statements given that 2021.
The sole director of Mageba Ntuli Trading and Consulting Service, Patrick Zulu, died a few decades in the past, In line with official documents. The corporate was deregistered with the CIPC for failing to submit economical statements due to the fact 2021.
Matamela Magodi, the sole director of Magodi Consultants, didn't reply to queries emailed to him.
GroundUp was struggling to locate any listing for Tafta Consulting and Accounting Services Along with the CIPC. We were also not able to trace any of the corporate’s administrators to request remark.