The accountants who assisted loot the Lottery
The accountants who assisted loot the Lottery
Blog Article
The Exclusive Investigating Unit has discovered 5 accounting firms that helped loot Lottery cash. Graphic: Lisa Nelson
The Exclusive Investigating Unit has determined 5 accounting and auditing companies that helped non-earnings providers loot Lottery income meant for “very good causes”.
The accounting firms compiled fraudulent monetary statements used by these providers to submit an application for Lottery funding, the SIU informed Parliament.
Performing chief national investigations officer Zodwa Xesibe said the SIU would get action to obtain these companies blacklisted.
A 4-yr probe by the cat888 Distinctive Investigating Device (SIU) has uncovered five accounting and auditing corporations that aided dodgy non-financial gain firms loot countless a lot of rands meant for “superior brings about” with the Lottery.
These corporations have been explained via the SIU as “Expert enablers,” who “compiled fraudulent money statements” that were utilized by the businesses to apply for Lottery funding.
The five corporations were being named in Parliament through the SIU’s acting chief nationwide 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 5 accounting companies assisted almost forty organizations get their palms on lottery funding, based on the SIU presentation.
Determined by a Resource that contains information with all lottery grants because 2002, these businesses obtained more than R314-million in funding.
“These NPCs were being funded by the Nationwide Lotteries Commission (NLC) however the funds were not utilized for his or her intended goal,” Xesibe explained to Parliament’s Trade, Marketplace and Level of competition Portfolio Committee previous week.
The SIU, the Hawks as well as the National Prosecuting Authority (NPA) had been in Parliament to report to the committee on progress in bringing persons and organisations involved in looting the lottery to e-book.
Xesibe instructed GroundUp which the SIU intended to lodge grievances in opposition to the accounting companies included and was checking if these firms had been registered and, In that case, with which professional bodies.
“We would like these firms to generally be blacklisted,” she informed GroundUp.
To qualify for Lottery funding, an organisation was required to create two a long time of yearly economic statements, Xesibe spelled out in Parliament.
Having said that, being an ongoing six-yr investigation into lottery corruption by GroundUp has unveiled, hijacked non-financial gain organisations (NPOs) or new shelf non-income corporations (NPCs) without any monetary keep track of information were utilized to submit an application for funding.
In some occasions, Practically identical financial statements were produced for unrelated organisations, generally with just the names from the organisations adjusted, GroundUp’s investigation identified.
Paperwork submitted by legitimate NPCs for unsuccessful grant purposes ended up often used by new or hijacked NPCs and NPOs to make an application for funding. The main points and paperwork of your unsuccessful applicants were equipped by senior Lottery officials into the dodgy applicants.
With cursory or - typically - no verification, these dodgy applicants were awarded millions of rands in grants. From time to time extra tranches of resources had been paid out out with out much examining on the progress of jobs.
The vast majority of these grants had been manufactured via proactive funding, which was at the center with the looting of the lottery. Proactive funding allowed the Minister of Trade, Sector and Competition, or the NLC together with its board, to determine triggers to fund without having 1st necessitating an software. This was stopped each time a new NLC board was appointed.
R2-billion in grants under investigation
SIU head Advocate Andy Mothibi reported the SIU was at present investigating grants valued at over R2-billion, as well as the device was still often obtaining suggestion-offs about extra corruption.
He told MPs that the SIU’s investigation had been damaged into a few phases: the main, that has been finalised, probed dodgy grants amounting to R280-million, and the next, also finished, involved R247-million. Within the third period, resulting from be finalised at the end of the calendar year, the SIU is investigating grants valued at Just about R906-million, involving 40 NPOs and NPCs, Mothibi mentioned.
He said which the SIU would utilize “before long” with the Presidential Proclamation, at first granted in Oct 2020 to research corruption involving lottery grants, for being extended to incorporate procurement because of the NLC.
The SIU investigation had to this point triggered 13 disciplinary referrals into the NLC, and administrative referrals to SARS and the Companies and Intellectual Houses Commission to blacklist persons implicated inside the looting. Problems involving two individuals had been referred to your Lawful Practice Council as well as the SA Institute of Chartered Accountants.
The SIU had observed a number of trends underneath the preceding NLC board and executive - many of whom have been implicated in looting - Mothibi told MPs.
This bundled a “craze of collusion among NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “typical maladministration during the approval of grants,” he claimed.
Slow progress via the NPA
The SIU has frozen houses, Qualities, autos and also other belongings well worth tens of tens of millions which were acquired with lottery resources, but MPs expressed issue at sluggish development in prosecuting Those people associated with the looting. (The SIU is mandated only to Get well assets bought with stolen state money and does not have prosecuting powers).
Even though the SIU has referred 15 issues to the NPA, up to now only two people have been brought prior to a court docket. Two Adult men appeared in courtroom in Kimberley just lately in connection with misappropriated money collected for just a task to overcome gender-primarily based violence.
In August 2022 Christopher Tshivule was sentenced to 8 many years in jail for his section inside of a R1.5-million lottery grant fraud. Fees in opposition to two people today charged with him, who the SIU has called “kingpins” inside the corruption that confused the NLC, have been dropped.
Major-Typical Mmeli Makinyane, the acting divisional commissioner for priority offences, informed MPs the Hawks were at the moment investigating sixteen lottery corruption-associated conditions. One more 1 - the Kimberley issue - is just before a courtroom and two are despatched on the NPA for a choice to prosecute. An additional five instances are increasingly being investigated via the SAPS detective and forensic companies, he explained.
Outlining The explanations for the hold off in prosecutions, NPA Deputy National Director Rodney de Kock reported Component of The rationale was the Hawks needed to do even more investigations once they been given dossiers from your SIU.
“In essence, the investigations carried out by the SIU usually do not fulfill prison requirements for prosecutions.”
Thus, the NPA experienced to operate with investigators within the DPCI (the Hawks) and SAPS to conduct criminal investigations and ensure that the evidence satisfies prison prosecution specifications, he explained, adding: “Having said that, the do the job with the SIU is important and contributes significantly to this method.”
De Kock claimed that the SIU’s investigation “usually ends in many referrals. The referrals may well in the long run end in one particular docket and 1 court docket case.”
He explained that twelve matters, which are “somewhere around eighty five% comprehensive”, were becoming jointly investigated with the Hawks as well as SIU’s Specialised Economic Operations Unit. (Most of these scenarios, 7 of which had been lodged in 2020, contain previous NLC Main functioning officer Phillemon Letwaba, who resigned under a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)
De Kock mentioned the NPA faced a number of “difficulties” in prosecuting scenarios. These, he claimed, provided
the lapse of time among if the offences were fully commited plus the issuing with the Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary proof” (Before this 12 months, the SIU advised the committee that key documents desired in certain prosecutions were deleted with the NLC Pc program or had long gone lacking from Metrofile, a warehouse exactly where copies of documents are archived and stored);
The truth that some implicated men and women are still used by NLC; and
A problem towards the legality of your Presidential Proclamation by former NLC chairperson Alfred Nevhutanda.
“The NPA is devoted to ensuring finalisation in these matters. To this conclusion, a workforce of dedicated prosecutors is allotted to supervise all NLC issues at the moment less than investigation,” de Kock said. “Matters are dealt with to be a precedence. As soon as [the] investigations are finished, the NPA will make a call.”
What the businesses say (or don’t)
GroundUp was only ready to get remark from one of the 5 providers accused via the SIU in Parliament of producing fraudulent once-a-year economical statements,TTP Consulting.
Aubrey Moeng, one of TTP’s two administrators, stated within an email in reaction to questions: “Due to consumer confidentiality, we prefer to advise that TTP Consulting just isn't prepared to disclose customers’ fiscal private info with the public or media … without the consent with the shopper or simply a lawful purpose.”
The business is often a “lover” of quite a few point out entities, together with SARS as well as the CIPC, As outlined by its Web page.
Neither of the two administrators of Dzata Accountants, that are equally shown as inactive on the CIPC sign-up of companies, responded to emailed inquiries. The organization has long been deregistered with the CIPC for failing to post financial statements due to the fact 2021.
The sole director of Mageba Ntuli Trading and Consulting Company, Patrick Zulu, died a few years ago, In accordance with official records. The business was deregistered through the CIPC for failing to submit monetary statements considering the fact that 2021.
Matamela Magodi, the only real director of Magodi Consultants, did not reply to issues emailed to him.
GroundUp was not able to locate any listing for Tafta Consulting and Accounting Providers Together with the CIPC. We had been also struggling to trace any of the organization’s administrators to request comment.