The accountants who aided loot the Lottery

The accountants who aided loot the Lottery

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The Specific Investigating Unit has recognized 5 accounting corporations that assisted loot Lottery resources. Graphic: Lisa Nelson

The Distinctive Investigating Device has identified 5 accounting and auditing corporations that served non-revenue firms loot Lottery revenue supposed for “superior brings about”.
The accounting companies compiled fraudulent economic statements used by these organizations to make an application for Lottery funding, the SIU advised Parliament.
Performing chief nationwide investigations officer Zodwa Xesibe reported the SIU would choose action to possess these companies blacklisted.
A 4-12 months probe by the cat888 Exclusive Investigating Device (SIU) has uncovered 5 accounting and auditing companies that served dodgy non-profit companies loot a huge selection of numerous rands designed for “fantastic results in” with the Lottery.

These firms were being explained from the SIU as “Qualified enablers,” who “compiled fraudulent economic statements” which were employed by the businesses to submit an application for Lottery funding.

The five firms were being named in Parliament from the SIU’s acting Main national investigations officer Zodwa Xesibe. They are really TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Companies.

Fraudulent financials produced by these five accounting companies assisted virtually 40 businesses get their arms on lottery funding, based on the SIU presentation.

Based on a Resource containing data with all lottery grants since 2002, these companies obtained above R314-million in funding.

“These NPCs were being funded through the Countrywide Lotteries Fee (NLC) however the money were not made use of for his or her supposed objective,” Xesibe advised Parliament’s Trade, Field and Competitiveness Portfolio Committee past week.

The SIU, the Hawks as well as Countrywide Prosecuting Authority (NPA) ended up in Parliament to report to the committee on development in bringing men and women and organisations associated with looting the lottery to e-book.

Xesibe told GroundUp the SIU intended to lodge problems versus the accounting companies involved and was examining if these companies were being registered and, If that is so, with which Expert bodies.

“We would like these organizations being blacklisted,” she explained to GroundUp.

To qualify for Lottery funding, an organisation was required to produce two many years of annual fiscal statements, Xesibe spelled out in Parliament.

Having said that, being an ongoing 6-year investigation into lottery corruption by GroundUp has exposed, hijacked non-profit organisations (NPOs) or new shelf non-financial gain providers (NPCs) without economic keep track of records have been utilized to submit an application for funding.

In a few instances, Pretty much identical fiscal statements had been generated for unrelated organisations, often with just the names from the organisations transformed, GroundUp’s investigation found.

Documents submitted by real NPCs for unsuccessful grant applications ended up generally utilized by new or hijacked NPCs and NPOs to submit an application for funding. The small print and documents of the unsuccessful applicants were equipped by senior Lottery officials towards the dodgy applicants.

With cursory or - often - no verification, these dodgy applicants were being awarded numerous rands in grants. At times further tranches of funds were being paid out out without having Significantly examining over the progress of initiatives.

The overwhelming majority of these grants have been produced through proactive funding, which was at the center of your looting from the lottery. Proactive funding authorized the Minister of Trade, Market and Competitiveness, or maybe the NLC in conjunction with its board, to discover will cause to fund devoid of to start with necessitating an application. This was stopped every time a new NLC board was appointed.

R2-billion in grants underneath investigation
SIU head Advocate Andy Mothibi mentioned the SIU was presently investigating grants valued at about R2-billion, along with the device was nevertheless routinely getting idea-offs about additional corruption.

He advised MPs that the SIU’s investigation were broken into 3 phases: the primary, that has been finalised, probed dodgy grants amounting to R280-million, and the second, also accomplished, included R247-million. In the third stage, as a consequence of be finalised at the conclusion of the year, the SIU is investigating grants valued at Nearly R906-million, involving 40 NPOs and NPCs, Mothibi said.

He said which the SIU would utilize “before long” for the Presidential Proclamation, initially granted in Oct 2020 to analyze corruption involving lottery grants, to get extended to incorporate procurement via the NLC.

The SIU investigation had up to now triggered 13 disciplinary referrals to the NLC, and administrative referrals to SARS and the businesses and Mental Houses Commission to blacklist individuals implicated during the looting. Grievances involving two people today were referred for the Lawful Practice Council as well as SA Institute of Chartered Accountants.

The SIU had noticed a number of developments beneath the preceding NLC board and government - a lot of whom are implicated in looting - Mothibi instructed MPs.

This provided a “trend of collusion concerning NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “general maladministration from the approval of grants,” he explained.

Gradual progress through the NPA
The SIU has frozen homes, Houses, cars and various assets well worth tens of tens of millions which were acquired with lottery funds, but MPs expressed problem at gradual progress in prosecuting All those involved in the looting. (The SIU is mandated only to Get well belongings purchased with stolen condition cash and doesn't have prosecuting powers).

Whilst the SIU has referred 15 matters towards the NPA, to date only two folks have been introduced just before a courtroom. Two Gentlemen appeared in court docket in Kimberley lately in connection with misappropriated funds gathered for a venture to battle gender-centered violence.

In August 2022 Christopher Tshivule was sentenced to eight yrs in prison for his portion in a very R1.5-million lottery grant fraud. Fees against two people today charged with him, who the SIU has referred to as “kingpins” during the corruption that overwhelmed the NLC, ended up dropped.

Significant-Typical Mmeli Makinyane, the performing divisional commissioner for priority offences, told MPs that the Hawks have been now investigating 16 lottery corruption-relevant instances. A further one - the Kimberley issue - is right before a courtroom and two are already sent into the NPA for a choice to prosecute. A further 5 instances are now being investigated through the SAPS detective and forensic companies, he explained.

Outlining The explanations for that delay in prosecutions, NPA Deputy Countrywide Director Rodney de Kock reported Portion of The main reason was that the Hawks had to do additional investigations if they received dossiers through the SIU.

“In essence, the investigations carried out from the SIU tend not to fulfill legal criteria for prosecutions.”

Therefore, the NPA experienced to operate with investigators in the DPCI (the Hawks) and SAPS to conduct criminal investigations and be certain that the evidence satisfies felony prosecution criteria, he reported, introducing: “That said, the function from the SIU is significant and contributes considerably to this method.”

De Kock explained that the SIU’s investigation “normally leads to various referrals. The referrals might finally cause just one docket and one court situation.”

He reported that twelve matters, that are “close to eighty five% complete”, have been remaining jointly investigated from the Hawks as well as the SIU’s Specialised Financial Functions Unit. (A large number of conditions, seven of which were lodged in 2020, involve former NLC chief functioning officer Phillemon Letwaba, who resigned underneath a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)

De Kock explained the NPA faced many “problems” in prosecuting instances. These, he reported, involved

the lapse of time concerning if the offences were being committed plus the issuing of your Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary evidence” (Earlier this year, the SIU informed the committee that essential files needed in some prosecutions were deleted from the NLC Pc program or experienced long gone missing from Metrofile, a warehouse where copies of paperwork are archived and stored);
the fact that some implicated people today are still employed by NLC; and
A obstacle on the legality with the Presidential Proclamation by former NLC chairperson Alfred Nevhutanda.
“The NPA is devoted to making sure finalisation in these matters. To this conclusion, a crew of focused prosecutors has actually been allotted to oversee all NLC issues at present below investigation,” de Kock stated. “Matters are managed as being a priority. When [the] investigations are concluded, the NPA could make a call.”

What the businesses say (or don’t)
GroundUp was only ready to get remark from one of the five organizations accused through the SIU in Parliament of manufacturing fraudulent yearly economic statements,TTP Consulting.

Aubrey Moeng, among TTP’s two directors, reported in an electronic mail in response to questions: “As a consequence of customer confidentiality, we desire to recommend that TTP Consulting isn't ready to disclose consumers’ financial confidential facts with the general public or media … without the consent from the consumer or maybe a lawful reason.”

The business can be a “associate” of numerous state entities, including SARS as well as CIPC, In keeping with its Internet site.

Neither of The 2 directors of Dzata Accountants, who will be equally outlined as inactive to the CIPC register of corporations, responded to emailed concerns. The corporate continues to be deregistered because of the CIPC for failing to post financial statements given that 2021.

The only real director of Mageba Ntuli Investing and Consulting Service, Patrick Zulu, died a few years ago, In line with official information. The organization was deregistered through the CIPC for failing to submit financial statements since 2021.

Matamela Magodi, the only real director of Magodi Consultants, did not reply to issues emailed to him.

GroundUp was not able to find any listing for Tafta Consulting and Accounting Services While using the CIPC. We have been also struggling to trace any of the business’s administrators to ask for comment.