The Specific Investigating Unit has discovered five accounting firms that served loot Lottery money. Graphic: Lisa Nelson
The Specific Investigating Device has determined 5 accounting and auditing companies that helped non-gain organizations loot Lottery cash supposed for “very good triggers”.
The accounting firms compiled fraudulent money statements used by these providers to apply for Lottery funding, the SIU advised Parliament.
Performing chief countrywide investigations officer Zodwa Xesibe explained the SIU would consider action to possess these corporations blacklisted.
A four-year probe by the cat888 Specific Investigating Unit (SIU) has exposed 5 accounting and auditing corporations that helped dodgy non-earnings businesses loot many a lot of rands designed for “great results in” from your Lottery.
These corporations had been explained through the SIU as “Experienced enablers,” who “compiled fraudulent fiscal statements” that were utilized by the companies to make an application for Lottery funding.
The 5 businesses have been named in Parliament by the SIU’s acting Main nationwide investigations officer Zodwa Xesibe. They are really TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Products and services.
Fraudulent financials produced by these 5 accounting companies helped nearly forty companies get their palms on lottery funding, in accordance with the SIU presentation.
Dependant on a Instrument that contains info with all lottery grants considering the fact that 2002, these providers got in excess of R314-million in funding.
“These NPCs had been funded because of the Countrywide Lotteries Fee (NLC) however the money were not utilized for his or her meant objective,” Xesibe informed Parliament’s Trade, Field and Competitors Portfolio Committee very last week.
The SIU, the Hawks as well as National Prosecuting Authority (NPA) were being in Parliament to report back to the committee on progress in bringing persons and organisations associated with looting the lottery to guide.
Xesibe explained to GroundUp that the SIU intended to lodge problems towards the accounting companies involved and was checking if these firms have been registered and, if so, with which Qualified bodies.
“We want these corporations to be blacklisted,” she advised GroundUp.
To qualify for Lottery funding, an organisation was necessary to develop two decades of yearly financial statements, Xesibe explained in Parliament.
Nonetheless, as an ongoing 6-yr investigation into lottery corruption by GroundUp has uncovered, hijacked non-earnings organisations (NPOs) or new shelf non-profit companies (NPCs) without having economic keep track of records were being used to make an application for funding.
In a few scenarios, Just about equivalent financial statements have been created for unrelated organisations, normally with just the names of the organisations modified, GroundUp’s investigation located.
Paperwork submitted by genuine NPCs for unsuccessful grant programs had been frequently employed by new or hijacked NPCs and NPOs to submit an application for funding. The small print and documents with the unsuccessful applicants ended up supplied by senior Lottery officers on the dodgy applicants.
With cursory or - typically - no verification, these dodgy applicants had been awarded a lot of rands in grants. Often extra tranches of funds ended up paid out devoid of A lot checking within the development of initiatives.
The overwhelming majority of those grants were manufactured by using proactive funding, which was at the guts of the looting from the lottery. Proactive funding authorized the Minister of Trade, Industry and Opposition, or the NLC together with its board, to identify will cause to fund with no 1st 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 stated the SIU was at this time investigating grants valued at over R2-billion, along with the device was continue to frequently obtaining suggestion-offs about a lot more corruption.
He explained to MPs which the SIU’s investigation were broken into 3 phases: the 1st, that has been finalised, probed dodgy grants amounting to R280-million, and the 2nd, also done, involved R247-million. Inside the third stage, due to be finalised at the end of the year, the SIU is investigating grants valued at Nearly R906-million, involving forty NPOs and NPCs, Mothibi said.
He said the SIU would use “soon” with the Presidential Proclamation, at first granted in October 2020 to analyze corruption involving lottery grants, to generally be prolonged to include procurement with the NLC.
The SIU investigation had so far brought about thirteen disciplinary referrals on the NLC, and administrative referrals to SARS and the businesses and Intellectual Homes Fee to blacklist men and women implicated within the looting. Issues involving two people today had been referred for the Authorized Exercise Council as well as the SA Institute of Chartered Accountants.
The SIU had observed many tendencies beneath the preceding NLC board and government - many of whom are already implicated in looting - Mothibi instructed MPs.
This involved a “pattern of collusion between NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “common maladministration in the approval of grants,” he claimed.
Sluggish progress because of the NPA
The SIU has frozen houses, Homes, cars and trucks and various assets well worth tens of thousands and thousands which were purchased with lottery cash, but MPs expressed worry at sluggish development in prosecuting those involved with the looting. (The SIU is mandated only to Get better belongings bought with stolen condition cash and doesn't have prosecuting powers).
While the SIU has referred 15 issues for the NPA, up to now only two people have been introduced just before a court. Two Gentlemen appeared in courtroom in Kimberley a short while ago in reference to misappropriated cash collected for the task to overcome gender-primarily based violence.
In August 2022 Christopher Tshivule was sentenced to 8 yrs in prison for his part in a very R1.5-million lottery grant fraud. Prices in opposition to two folks billed with him, who the SIU has called “kingpins” while in the corruption that confused the NLC, were being dropped.
Important-General Mmeli Makinyane, the acting divisional commissioner for priority offences, advised MPs which the Hawks were being at present investigating 16 lottery corruption-similar circumstances. A different a person - the Kimberley matter - is in advance of a court docket and two are actually despatched on the NPA for a decision to prosecute. An additional five situations are now being investigated through the SAPS detective and forensic products and services, he reported.
Outlining the reasons with the delay in prosecutions, NPA Deputy Countrywide Director Rodney de Kock said Element of The rationale was which the Hawks needed to do even further investigations once they acquired dossiers with the SIU.
“In essence, the investigations carried out from the SIU tend not to fulfill prison expectations for prosecutions.”
Therefore, the NPA experienced to work with investigators inside the DPCI (the Hawks) and SAPS to conduct criminal investigations and be sure that the proof fulfills legal prosecution expectations, he explained, adding: “Having said that, the operate from the SIU is important and contributes considerably to this method.”
De Kock explained which the SIU’s investigation “frequently leads to many referrals. The referrals might eventually end in one docket and one court case.”
He stated that 12 matters, which are “around 85% finish”, have been currently being jointly investigated through the Hawks along with the SIU’s Specialised Economic Functions Unit. (A large number of scenarios, seven of which were lodged in 2020, entail previous NLC chief functioning officer Phillemon Letwaba, who resigned underneath a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)
De Kock explained the NPA confronted numerous “worries” in prosecuting situations. These, he said, incorporated
the lapse of your time concerning when the offences have been dedicated and the issuing from the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary evidence” (Earlier this yr, the SIU informed the committee that crucial paperwork necessary in some prosecutions had been deleted in the NLC Laptop method or experienced absent lacking from Metrofile, a warehouse where copies of files are archived and stored);
the fact that some implicated persons are still utilized by NLC; and
A challenge into the legality on the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is committed to guaranteeing finalisation in these issues. To this finish, a staff of dedicated prosecutors has actually been allotted to supervise all NLC issues presently beneath investigation,” de Kock claimed. “Issues are taken care of as being a precedence. As soon as [the] investigations are finished, the NPA can make a decision.”
What the companies say (or don’t)
GroundUp was only in a position to get comment from among the 5 firms accused from the SIU in Parliament of manufacturing fraudulent yearly financial statements,TTP Consulting.
Aubrey Moeng, amongst TTP’s two directors, stated within an electronic mail in response to thoughts: “As a consequence of consumer confidentiality, we need to advise that TTP Consulting is just not prepared to disclose clientele’ fiscal private information and facts with the public or media … without the consent on the customer or maybe a lawful rationale.”
The company is really a “companion” of several point out entities, including SARS and also the CIPC, Based on its website.
Neither of The 2 directors of Dzata Accountants, who will be the two outlined as inactive over the CIPC register of companies, responded to emailed inquiries. The company has become deregistered via the CIPC for failing to submit monetary statements due to the fact 2021.
The only real director of Mageba Ntuli Investing and Consulting Service, Patrick Zulu, died three many years ago, In accordance with official information. The business was deregistered with the CIPC for failing to submit monetary statements given that 2021.
Matamela Magodi, the sole director of Magodi Consultants, didn't reply to queries emailed to him.
GroundUp was unable to find any listing for Tafta Consulting and Accounting Solutions Using the CIPC. We were being also unable to trace any of the corporation’s directors to request remark.