The accountants who helped loot the Lottery
The accountants who helped loot the Lottery
Blog Article
The Exclusive Investigating Unit has determined 5 accounting firms that served loot Lottery money. Graphic: Lisa Nelson
The Distinctive Investigating Device has discovered 5 accounting and auditing companies that assisted non-income corporations loot Lottery money supposed for “very good triggers”.
The accounting corporations compiled fraudulent economical statements employed by these firms to apply for Lottery funding, the SIU instructed Parliament.
Performing chief countrywide investigations officer Zodwa Xesibe explained the SIU would take action to get these corporations blacklisted.
A four-yr probe from the ตรวจ ล้อ ต เต อ รี่ Exclusive Investigating Unit (SIU) has uncovered five accounting and auditing firms that aided dodgy non-earnings businesses loot many hundreds of numerous rands designed for “excellent brings about” from the Lottery.
These companies were being explained by the SIU as “Specialist enablers,” who “compiled fraudulent money statements” that were utilized by the companies to make an application for Lottery funding.
The 5 corporations have been named in Parliament from the SIU’s performing Main nationwide investigations officer Zodwa Xesibe. They are really TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Companies.
Fraudulent financials made by these 5 accounting corporations served almost 40 firms get their palms on lottery funding, in accordance with the SIU presentation.
Based on a Resource that contains knowledge with all lottery grants due to the fact 2002, these firms acquired above R314-million in funding.
“These NPCs had been funded from the Countrywide Lotteries Commission (NLC) but the cash were not utilised for their meant objective,” Xesibe explained to Parliament’s Trade, Market and Competitors Portfolio Committee very last 7 days.
The SIU, the Hawks as well as Nationwide Prosecuting Authority (NPA) have been in Parliament to report to the committee on progress in bringing people today and organisations associated with looting the lottery to book.
Xesibe instructed GroundUp which the SIU meant to lodge complaints towards the accounting firms concerned and was examining if these firms were being registered and, In that case, with which Experienced bodies.
“We would like these firms being blacklisted,” she instructed GroundUp.
To qualify for Lottery funding, an organisation was necessary to make two a long time of annual money statements, Xesibe spelled out in Parliament.
On the other hand, as an ongoing six-calendar year investigation into lottery corruption by GroundUp has disclosed, hijacked non-financial gain organisations (NPOs) or new shelf non-earnings businesses (NPCs) with no economical monitor documents had been accustomed to submit an application for funding.
In some circumstances, Just about equivalent economical statements were being produced for unrelated organisations, frequently with just the names with the organisations changed, GroundUp’s investigation found.
Files submitted by real NPCs for unsuccessful grant applications were being generally utilized by new or hijacked NPCs and NPOs to apply for funding. The main points and paperwork in the unsuccessful applicants had been equipped by senior Lottery officers towards the dodgy applicants.
With cursory or - normally - no verification, these dodgy applicants ended up awarded countless rands in grants. In some cases additional tranches of money were being compensated out without having A great deal examining on the progress of tasks.
The vast majority of these grants were produced by way of proactive funding, which was at the center with the looting with the lottery. Proactive funding permitted the Minister of Trade, Market and Competitiveness, or even the NLC together with its board, to establish causes to fund without first necessitating an application. This was stopped each time a new NLC board was appointed.
R2-billion in grants underneath investigation
SIU head Advocate Andy Mothibi stated the SIU was presently investigating grants valued at over R2-billion, as well as unit was nonetheless routinely acquiring tip-offs about much more corruption.
He told MPs the SIU’s investigation were broken into three phases: the first, that has been finalised, probed dodgy grants amounting to R280-million, and the second, also done, concerned R247-million. During the third period, as a result of be finalised at the end of the calendar year, the SIU is investigating grants valued at Nearly R906-million, involving forty NPOs and NPCs, Mothibi said.
He reported the SIU would apply “before long” for that Presidential Proclamation, originally granted in Oct 2020 to investigate corruption involving lottery grants, being extended to include procurement because of the NLC.
The SIU investigation experienced up to now resulted in 13 disciplinary referrals to your NLC, and administrative referrals to SARS and the businesses and Mental Properties Commission to blacklist individuals implicated inside the looting. Grievances involving two folks had been referred for the Legal Practice Council and also the SA Institute of Chartered Accountants.
The SIU experienced observed numerous trends beneath the earlier NLC board and executive - lots of whom are already implicated in looting - Mothibi advised MPs.
This integrated a “craze of collusion in between NLC officers and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “general maladministration from the acceptance of grants,” he mentioned.
Sluggish development by the NPA
The SIU has frozen houses, Houses, cars and also other belongings worth tens of hundreds of thousands that were bought with lottery money, but MPs expressed problem at slow progress in prosecuting those involved in the looting. (The SIU is mandated only to recover assets acquired with stolen condition money and doesn't have prosecuting powers).
Though the SIU has referred 15 issues to your NPA, to date only two people have been introduced just before a court docket. Two Gentlemen appeared in court docket in Kimberley not long ago in connection with misappropriated cash gathered for any project to overcome gender-centered violence.
In August 2022 Christopher Tshivule was sentenced to eight a long time in jail for his component in the R1.five-million lottery grant fraud. Charges towards two persons billed with him, who the SIU has called “kingpins” within the corruption that overwhelmed the NLC, had been dropped.
Main-Standard Mmeli Makinyane, the acting divisional commissioner for priority offences, told MPs which the Hawks ended up now investigating 16 lottery corruption-associated cases. A further a person - the Kimberley issue - is just before a court docket and two have already been despatched for the NPA for a call to prosecute. A further five scenarios are being investigated with the SAPS detective and forensic services, he explained.
Explaining the reasons for your delay in prosecutions, NPA Deputy Nationwide Director Rodney de Kock explained Component of the reason was which the Hawks needed to do further more investigations every time they been given dossiers within the SIU.
“In essence, the investigations carried out with the SIU usually do not satisfy felony expectations for prosecutions.”
As a result, the NPA experienced to work with investigators in the DPCI (the Hawks) and SAPS to carry out criminal investigations and ensure that the proof satisfies legal prosecution benchmarks, he mentioned, incorporating: “Having said that, the perform with the SIU is very important and contributes considerably to this method.”
De Kock said that the SIU’s investigation “frequently leads to a number of referrals. The referrals may well finally bring about a person docket and a person court docket scenario.”
He mentioned that 12 issues, which might be “about 85% entire”, ended up currently being jointly investigated from the Hawks and the SIU’s Specialised Financial Operations Unit. (Most of these scenarios, seven of which have been lodged in 2020, contain former NLC chief running officer Phillemon Letwaba, who resigned less than a cloud in 2022, and Pretoria lawyer Leslie Ramulifho.)
De Kock mentioned the NPA confronted quite a few “challenges” in prosecuting circumstances. These, he explained, involved
the lapse of your time involving if the offences ended up dedicated along with the issuing on the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary evidence” (Before this 12 months, the SIU advised the committee that crucial documents wanted in a few prosecutions were deleted with the NLC Personal computer method or experienced gone lacking from Metrofile, a warehouse exactly where copies of paperwork are archived and stored);
The truth that some implicated individuals are still utilized by NLC; and
A obstacle towards the legality on the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is dedicated to ensuring finalisation in these matters. To this stop, a staff of focused prosecutors has been allocated to supervise all NLC issues now less than investigation,” de Kock said. “Issues are managed for a priority. As soon as [the] investigations are finished, the NPA will make a call.”
What the companies say (or don’t)
GroundUp was only capable of get remark from on the list of five businesses accused via the SIU in Parliament of producing fraudulent once-a-year fiscal statements,TTP Consulting.
Aubrey Moeng, certainly one of TTP’s two administrators, stated within an electronic mail in response to inquiries: “Because of customer confidentiality, we need to recommend that TTP Consulting isn't ready to divulge consumers’ money private information and facts with the general public or media … with no consent of your shopper or simply a lawful rationale.”
The company is a “spouse” of numerous state entities, such as SARS and the CIPC, according to its Web-site.
Neither of the two administrators of Dzata Accountants, that are each stated as inactive within the CIPC sign up of organizations, responded to emailed thoughts. The business has been deregistered with the CIPC for failing to post monetary statements considering the fact that 2021.
The sole director of Mageba Ntuli Trading and Consulting Provider, Patrick Zulu, died 3 yrs back, In keeping with Formal documents. The corporation was deregistered by the CIPC for failing to post money statements due to the fact 2021.
Matamela Magodi, the only director of Magodi Consultants, didn't respond to queries emailed to him.
GroundUp was unable to obtain any listing for Tafta Consulting and Accounting Expert services Along with the CIPC. We had been also struggling to trace any of the organization’s administrators to ask for comment.