The accountants who helped loot the Lottery
The accountants who helped loot the Lottery
Blog Article
The Distinctive Investigating Unit has recognized 5 accounting companies that served loot Lottery money. Graphic: Lisa Nelson
The Special Investigating Unit has discovered five accounting and auditing companies that aided non-revenue companies loot Lottery income supposed for “great will cause”.
The accounting corporations compiled fraudulent monetary statements used by these firms to make an application for Lottery funding, the SIU instructed Parliament.
Performing chief national investigations officer Zodwa Xesibe mentioned the SIU would get action to possess these corporations blacklisted.
A 4-yr probe from the หวย Exclusive Investigating Device (SIU) has uncovered five accounting and auditing firms that helped dodgy non-earnings firms loot many a lot of rands intended for “excellent triggers” in the Lottery.
These corporations ended up described via the SIU as “Qualified enablers,” who “compiled fraudulent economic statements” which were used by the businesses to apply for Lottery funding.
The five corporations had been named in Parliament because of the SIU’s performing chief national investigations officer Zodwa Xesibe. These are TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Solutions.
Fraudulent financials produced by these five accounting firms assisted just about 40 companies get their arms on lottery funding, in accordance with the SIU presentation.
Dependant on a Software that contains data with all lottery grants because 2002, these organizations obtained above R314-million in funding.
“These NPCs were funded via the Nationwide Lotteries Fee (NLC) but the resources weren't utilised for his or her meant purpose,” Xesibe explained to Parliament’s Trade, Marketplace and Competitiveness Portfolio Committee last 7 days.
The SIU, the Hawks plus the National Prosecuting Authority (NPA) were in Parliament to report to the committee on development in bringing individuals and organisations linked to looting the lottery to e book.
Xesibe advised GroundUp which the SIU intended to lodge complaints from the accounting corporations concerned and was examining if these companies were registered and, If that is so, with which professional bodies.
“We want these businesses for being blacklisted,” she informed GroundUp.
To qualify for Lottery funding, an organisation was required to deliver two decades of yearly economic statements, Xesibe discussed in Parliament.
Even so, being an ongoing six-year investigation into lottery corruption by GroundUp has exposed, hijacked non-gain organisations (NPOs) or new shelf non-income businesses (NPCs) without any economical monitor records had been utilized to make an application for funding.
In certain instances, Practically similar monetary statements had been developed for unrelated organisations, normally with just the names of your organisations improved, GroundUp’s investigation uncovered.
Paperwork submitted by real NPCs for unsuccessful grant applications were often employed by new or hijacked NPCs and NPOs to make an application for funding. The main points and documents on the unsuccessful applicants were being supplied by senior Lottery officials on the dodgy applicants.
With cursory or - normally - no verification, these dodgy applicants had been awarded a lot of rands in grants. Sometimes extra tranches of money had been paid out with out Considerably checking within the progress of jobs.
The overwhelming majority of those grants had been made by using proactive funding, which was at the center from the looting of the lottery. Proactive funding authorized the Minister of Trade, Market and Competitiveness, or the NLC along side its board, to recognize results in to fund without having to start with requiring an application. This was stopped each time a new NLC board was appointed.
R2-billion in grants underneath investigation
SIU head Advocate Andy Mothibi said the SIU was at present investigating grants valued at about R2-billion, as well as device was continue to regularly receiving idea-offs about extra corruption.
He explained to MPs the SIU’s investigation had been damaged into 3 phases: the primary, which has been finalised, probed dodgy grants amounting to R280-million, and the 2nd, also concluded, concerned R247-million. In the 3rd phase, as a consequence of be finalised at the end of the calendar year, the SIU is investigating grants valued at Virtually R906-million, involving forty NPOs and NPCs, Mothibi mentioned.
He reported that the SIU would implement “before long” to the Presidential Proclamation, at first granted in Oct 2020 to analyze corruption involving lottery grants, to become extended to include procurement because of the NLC.
The SIU investigation experienced to this point led to thirteen disciplinary referrals to the NLC, and administrative referrals to SARS and the Companies and Mental Attributes Fee to blacklist people today implicated in the looting. Problems involving two people today were referred on the Legal Practice Council and the SA Institute of Chartered Accountants.
The SIU experienced observed quite a few developments under the past NLC board and executive - most of whom are already implicated in looting - Mothibi informed MPs.
This involved a “pattern of collusion involving NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “standard maladministration in the approval of grants,” he explained.
Gradual development by the NPA
The SIU has frozen houses, Homes, autos and other assets really worth tens of hundreds of thousands that were acquired with lottery resources, but MPs expressed worry at sluggish progress in prosecuting those linked to the looting. (The SIU is mandated only to Get well property acquired with stolen condition funds and doesn't have prosecuting powers).
Although the SIU has referred fifteen matters to the NPA, thus far only two people have been introduced prior to a courtroom. Two Males appeared in courtroom in Kimberley lately in reference to misappropriated resources gathered for any challenge to combat gender-based mostly violence.
In August 2022 Christopher Tshivule was sentenced to 8 decades in prison for his component within a R1.5-million lottery grant fraud. Fees versus two people today billed with him, who the SIU has called “kingpins” from the corruption that overcome the NLC, have been dropped.
Key-Standard Mmeli Makinyane, the acting divisional commissioner for precedence offences, instructed MPs the Hawks had been currently investigating sixteen lottery corruption-connected instances. Another a person - the Kimberley issue - is prior to a courtroom and two happen to be sent to the NPA for a choice to prosecute. An additional 5 instances are now being investigated via the SAPS detective and forensic solutions, he explained.
Conveying The explanations for the hold off in prosecutions, NPA Deputy Countrywide Director Rodney de Kock stated Component of the reason was which the Hawks needed to do more investigations every time they received dossiers in the SIU.
“In essence, the investigations undertaken by the SIU do not fulfill legal requirements for prosecutions.”
Therefore, the NPA experienced to operate with investigators from the DPCI (the Hawks) and SAPS to conduct felony investigations and make certain that the proof meets legal prosecution standards, he explained, introducing: “That said, the operate of your SIU is very important and contributes considerably to this method.”
De Kock said that the SIU’s investigation “usually leads to many referrals. The referrals may perhaps ultimately lead to one particular docket and a person court docket scenario.”
He explained that 12 issues, that are “about 85% full”, had been getting jointly investigated with the Hawks and also the SIU’s Specialised Financial Functions Unit. (These types of circumstances, 7 of which had been lodged in 2020, contain former NLC Main functioning officer Phillemon Letwaba, who resigned beneath a cloud in 2022, and Pretoria attorney Leslie Ramulifho.)
De Kock stated the NPA faced various “difficulties” in prosecuting conditions. These, he stated, bundled
the lapse of time concerning if the offences had been committed as well as issuing from the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary evidence” (Earlier this yr, the SIU instructed the committee that vital files desired in certain prosecutions had been deleted through the NLC Laptop or computer procedure or experienced long gone missing from Metrofile, a warehouse in which copies of documents are archived and saved);
The point that some implicated folks are still used by NLC; and
A problem towards the legality of the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is committed to guaranteeing finalisation in these matters. To this close, a group of focused prosecutors has long been allocated to oversee all NLC issues at present beneath investigation,” de Kock claimed. “Issues are handled being a priority. After [the] investigations are concluded, the NPA is likely to make a choice.”
What the companies say (or don’t)
GroundUp was only capable to get comment from on the list of 5 firms accused because of the SIU in Parliament of producing fraudulent yearly economical statements,TTP Consulting.
Aubrey Moeng, amongst TTP’s two directors, reported in an electronic mail in response to inquiries: “Because of customer confidentiality, we want to suggest that TTP Consulting is not ready to disclose shoppers’ monetary confidential details with the public or media … without the consent on the customer or simply a lawful reason.”
The business is usually a “partner” of numerous state entities, which include SARS and the CIPC, In accordance with its Web page.
Neither of The 2 directors of Dzata Accountants, who will be both of those stated 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 economical statements because 2021.
The only director of Mageba Ntuli Buying and selling and Consulting Service, Patrick Zulu, died 3 a long time ago, In line with official documents. The corporation was deregistered via the CIPC for failing to post economic statements given that 2021.
Matamela Magodi, the sole director of Magodi Consultants, didn't respond to questions emailed to him.
GroundUp was struggling to locate any listing for Tafta Consulting and Accounting Solutions While using the CIPC. We have been also struggling to trace any of the organization’s directors to request remark.