The accountants who aided loot the Lottery

The accountants who aided loot the Lottery

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The Unique Investigating Unit has determined 5 accounting corporations that assisted loot Lottery money. Graphic: Lisa Nelson

The Unique Investigating Unit has recognized five accounting and auditing firms that served non-profit organizations loot Lottery cash supposed for “superior results in”.
The accounting companies compiled fraudulent economic statements employed by these firms to make an application for Lottery funding, the SIU advised Parliament.
Acting chief countrywide investigations officer Zodwa Xesibe mentioned the SIU would take action to obtain these firms blacklisted.
A four-yr probe through the ltpbet Special Investigating Device (SIU) has uncovered 5 accounting and auditing companies that served dodgy non-earnings providers loot countless countless rands intended for “fantastic causes” through the Lottery.

These companies were described by the SIU as “professional enablers,” who “compiled fraudulent fiscal statements” which were used by the companies to make an application for Lottery funding.

The five firms had been named in Parliament from the SIU’s acting chief nationwide investigations officer Zodwa Xesibe. They are TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Expert services.

Fraudulent financials produced by these 5 accounting firms served practically 40 organizations get their palms on lottery funding, in accordance with the SIU presentation.

Determined by a Instrument made up of info with all lottery grants considering that 2002, these businesses bought above R314-million in funding.

“These NPCs had been funded because of the National Lotteries Commission (NLC) however the cash were not used for his or her intended intent,” Xesibe informed Parliament’s Trade, Field and Levels of competition Portfolio Committee final week.

The SIU, the Hawks and also the National Prosecuting Authority (NPA) ended up in Parliament to report back to the committee on progress in bringing individuals and organisations involved in looting the lottery to reserve.

Xesibe instructed GroundUp that the SIU intended to lodge issues towards the accounting corporations involved and was checking if these firms ended up registered and, If that's the case, with which professional bodies.

“We would like these corporations to be blacklisted,” she advised GroundUp.

To qualify for Lottery funding, an organisation was necessary to generate two yrs of once-a-year economical statements, Xesibe stated in Parliament.

Nonetheless, as an ongoing six-yr investigation into lottery corruption by GroundUp has unveiled, hijacked non-financial gain organisations (NPOs) or new shelf non-profit companies (NPCs) with no financial track documents ended up used to apply for funding.

In a few situations, almost similar financial statements ended up made for unrelated organisations, generally with only the names with the organisations transformed, GroundUp’s investigation found.

Documents submitted by real NPCs for unsuccessful grant programs ended up often employed by new or hijacked NPCs and NPOs to apply for funding. The main points and files with the unsuccessful applicants ended up provided by senior Lottery officials to the dodgy applicants.

With cursory or - normally - no verification, these dodgy applicants ended up awarded a lot of rands in grants. Often further tranches of funds have been paid out devoid of Considerably examining within the development of tasks.

The overwhelming majority of these grants have been made through proactive funding, which was at the center of your looting in the lottery. Proactive funding authorized the Minister of Trade, Business and Competition, or even the NLC along with its board, to detect leads to to fund with no initially demanding an application. This was stopped when a new NLC board was appointed.

R2-billion in grants less than investigation
SIU head Advocate Andy Mothibi claimed the SIU was at the moment investigating grants valued at above R2-billion, and also the device was nevertheless routinely acquiring tip-offs about extra corruption.

He advised MPs which the SIU’s investigation had been broken into 3 phases: the main, which has been finalised, probed dodgy grants amounting to R280-million, and the second, also concluded, associated R247-million. Inside the third stage, as a consequence of be finalised at the conclusion of the calendar year, the SIU is investigating grants valued at Nearly R906-million, involving 40 NPOs and NPCs, Mothibi said.

He explained which the SIU would apply “shortly” for the Presidential Proclamation, originally granted in October 2020 to research corruption involving lottery grants, to generally be prolonged to include procurement through the NLC.

The SIU investigation had up to now led to thirteen disciplinary referrals to your NLC, and administrative referrals to SARS and the businesses and Mental Houses Commission to blacklist people implicated in the looting. Problems involving two men and women had been referred on the Lawful Follow Council as well as the SA Institute of Chartered Accountants.

The SIU experienced noticed numerous traits under the past NLC board and executive - most of whom are already implicated in looting - Mothibi informed MPs.

This bundled a “trend of collusion among NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “basic maladministration inside the approval of grants,” he stated.

Slow development with the NPA
The SIU has frozen properties, Qualities, cars along with other belongings worthy of tens of hundreds of thousands which were purchased with lottery resources, but MPs expressed problem at gradual progress in prosecuting People involved in 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 fifteen issues for the NPA, up to now only two folks have been introduced ahead of a court. Two Guys appeared in courtroom in Kimberley lately in reference to misappropriated funds collected to get a undertaking to beat gender-based violence.

In August 2022 Christopher Tshivule was sentenced to eight a long time in prison for his section inside of a R1.five-million lottery grant fraud. Charges towards two men and women charged with him, who the SIU has described as “kingpins” in the corruption that confused the NLC, ended up dropped.

Main-Common Mmeli Makinyane, the performing divisional commissioner for precedence offences, informed MPs the Hawks were being presently investigating 16 lottery corruption-related instances. An additional one - the Kimberley make a difference - is just before a courtroom and two are actually despatched towards the NPA for a choice to prosecute. An extra 5 instances are now being investigated via the SAPS detective and forensic solutions, he stated.

Describing The explanations with the hold off in prosecutions, NPA Deputy Nationwide Director Rodney de Kock mentioned Portion of The main reason was that the Hawks needed to do even further investigations when they been given dossiers with the SIU.

“In essence, the investigations undertaken through the SIU don't fulfill criminal requirements for prosecutions.”

Hence, the NPA experienced to work with investigators inside the DPCI (the Hawks) and SAPS to carry out felony investigations and make sure that the evidence fulfills criminal prosecution standards, he stated, introducing: “That said, the perform with the SIU is important and contributes significantly to this method.”

De Kock claimed the SIU’s investigation “typically results in a number of referrals. The referrals might ultimately end in a single docket and one courtroom scenario.”

He stated that 12 issues, which are “about 85% comprehensive”, had been remaining jointly investigated because of the Hawks and the SIU’s Specialised Financial Functions Device. (These types of conditions, 7 of which ended up lodged in 2020, require previous NLC chief functioning officer Phillemon Letwaba, who resigned underneath a cloud in 2022, and Pretoria attorney Leslie Ramulifho.)

De Kock claimed the NPA confronted many “issues” in prosecuting circumstances. These, he reported, provided

the lapse of your time involving once the offences ended up committed and the issuing on the Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary evidence” (Earlier this year, the SIU explained to the committee that critical documents necessary in a few prosecutions were deleted from the NLC Laptop procedure or experienced long gone lacking from Metrofile, a warehouse exactly where copies of documents are archived and stored);
The truth that some implicated men and women remain employed by NLC; and
A challenge to the legality of the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is dedicated to making certain finalisation in these matters. To this close, a crew of dedicated prosecutors has been allotted to supervise all NLC matters currently less than investigation,” de Kock explained. “Issues are handled for a priority. At the time [the] investigations are finished, the NPA is likely to make a call.”

What the companies say (or don’t)
GroundUp was only ready to get comment from on the list of 5 organizations accused because of the SIU in Parliament of manufacturing fraudulent yearly money statements,TTP Consulting.

Aubrey Moeng, amongst TTP’s two administrators, claimed within an e-mail in reaction to inquiries: “As a consequence of customer confidentiality, we desire to recommend that TTP Consulting is just not willing to disclose customers’ financial confidential details with the public or media … with no consent from the shopper or possibly a lawful cause.”

The company is often a “companion” of many point out entities, which includes SARS plus the CIPC, Based on its Site.

Neither of the two directors of Dzata Accountants, who are the two shown as inactive about the CIPC sign-up of organizations, responded to emailed inquiries. The business has become deregistered from the CIPC for failing to post economic statements given that 2021.

The only real director of Mageba Ntuli Buying and selling and Consulting Service, Patrick Zulu, died 3 many years back, In line with Formal records. The corporate was deregistered by the CIPC for failing to submit economic statements considering the fact that 2021.

Matamela Magodi, the sole director of Magodi Consultants, did not reply to questions emailed to him.

GroundUp was unable to locate any listing for Tafta Consulting and Accounting Companies While using the CIPC. We were being also struggling to trace any of the corporate’s directors to ask for remark.

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