The accountants who assisted loot the Lottery
The accountants who assisted loot the Lottery
Blog Article
The Special Investigating Unit has recognized 5 accounting companies that served loot Lottery money. Graphic: Lisa Nelson
The Special Investigating Unit has determined 5 accounting and auditing corporations that helped non-income businesses loot Lottery income meant for “superior triggers”.
The accounting firms compiled fraudulent economic statements utilized by these firms to make an application for Lottery funding, the SIU informed Parliament.
Acting Main nationwide investigations officer Zodwa Xesibe stated the SIU would consider motion to own these firms blacklisted.
A 4-yr probe by the fox888 Specific Investigating Unit (SIU) has exposed 5 accounting and auditing companies that assisted dodgy non-revenue businesses loot a huge selection of millions of rands designed for “excellent leads to” from the Lottery.
These companies were explained by the SIU as “Qualified enablers,” who “compiled fraudulent economic statements” which were employed by the companies to make an application for Lottery funding.
The 5 providers had been named in Parliament with the SIU’s performing Main countrywide investigations officer Zodwa Xesibe. They are TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Providers.
Fraudulent financials produced by these five accounting corporations served approximately forty corporations get their palms on lottery funding, based on the SIU presentation.
Determined by a Instrument containing details with all lottery grants considering the fact that 2002, these firms received over R314-million in funding.
“These NPCs have been funded through the Nationwide Lotteries Fee (NLC) however the resources were not utilised for his or her supposed objective,” Xesibe informed Parliament’s Trade, Sector and Competitors Portfolio Committee final 7 days.
The SIU, the Hawks plus the Countrywide Prosecuting Authority (NPA) had been in Parliament to report back to the committee on development in bringing people and organisations associated with looting the lottery to ebook.
Xesibe explained to GroundUp that the SIU intended to lodge issues versus the accounting corporations involved and was checking if these firms had been registered and, If that is so, with which Experienced bodies.
“We want these firms to become blacklisted,” she told GroundUp.
To qualify for Lottery funding, an organisation was required to produce two years of annual economical statements, Xesibe spelled out in Parliament.
On the other hand, as an ongoing 6-year investigation into lottery corruption by GroundUp has revealed, hijacked non-gain organisations (NPOs) or new shelf non-income companies (NPCs) with no monetary monitor information have been accustomed to make an application for funding.
In some situations, Nearly identical economical statements were being generated for unrelated organisations, typically with only the names of the organisations improved, GroundUp’s investigation located.
Documents submitted by authentic NPCs for unsuccessful grant applications ended up frequently employed by new or hijacked NPCs and NPOs to apply for funding. The small print and paperwork of the unsuccessful applicants have been equipped by senior Lottery officers towards the dodgy applicants.
With cursory or - usually - no verification, these dodgy applicants ended up awarded millions of rands in grants. At times added tranches of cash have been paid out out with no A great deal examining to the development of assignments.
The vast majority of such grants ended up designed through proactive funding, which was at the heart of your looting with the lottery. Proactive funding allowed the Minister of Trade, Industry and Competition, or perhaps the NLC together with its board, to detect brings about to fund without 1st demanding an application. This was stopped whenever a new NLC board was appointed.
R2-billion in grants underneath investigation
SIU head Advocate Andy Mothibi reported the SIU was presently investigating grants valued at above R2-billion, plus the device was continue to regularly receiving idea-offs about extra corruption.
He explained to MPs which the SIU’s investigation had been broken into a few phases: the 1st, which has been finalised, probed dodgy grants amounting to R280-million, and the second, also done, included R247-million. Inside the 3rd period, because of be finalised at the conclusion of the yr, the SIU is investigating grants valued at almost R906-million, involving 40 NPOs and NPCs, Mothibi reported.
He mentioned which the SIU would apply “shortly” for the Presidential Proclamation, originally granted in October 2020 to research corruption involving lottery grants, to generally be extended to include procurement with the NLC.
The SIU investigation experienced to this point triggered thirteen disciplinary referrals to the NLC, and administrative referrals to SARS and the Companies and Mental Properties Fee to blacklist people today implicated in the looting. Problems involving two people were referred on the Authorized Practice Council and the SA Institute of Chartered Accountants.
The SIU experienced observed quite a few tendencies under the former NLC board and government - most of whom are already implicated in looting - Mothibi informed MPs.
This bundled a “pattern of collusion concerning NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “standard maladministration in the approval of grants,” he explained.
Sluggish development via the NPA
The SIU has frozen houses, Qualities, autos and other assets worth tens of millions which were acquired with lottery cash, but MPs expressed worry at slow development in prosecuting Those people involved with the looting. (The SIU is mandated only to Get well assets acquired with stolen condition funds and doesn't have prosecuting powers).
Whilst the SIU has referred fifteen matters into the NPA, to date 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 job to combat gender-based mostly violence.
In August 2022 Christopher Tshivule was sentenced to eight yrs in jail for his part within a R1.5-million lottery grant fraud. Fees from two persons billed with him, who the SIU has referred to as “kingpins” from the corruption that overcome the NLC, have been dropped.
Main-Basic Mmeli Makinyane, the performing divisional commissioner for precedence offences, informed MPs that the Hawks ended up at the moment investigating 16 lottery corruption-similar scenarios. One more 1 - the Kimberley make any difference - is ahead of a court and two are already despatched for the NPA for a choice to prosecute. An extra five circumstances are increasingly being investigated by the SAPS detective and forensic companies, he claimed.
Explaining The explanations for the delay in prosecutions, NPA Deputy National Director Rodney de Kock said A part of The explanation was that the Hawks needed to do further more investigations when they been given dossiers within the SIU.
“In essence, the investigations undertaken from the SIU don't fulfill legal standards for prosecutions.”
Hence, the NPA had to operate with investigators within the DPCI (the Hawks) and SAPS to carry out criminal investigations and be certain that the proof meets legal prosecution benchmarks, he mentioned, incorporating: “Having said that, the work in the SIU is crucial and contributes greatly to this process.”
De Kock stated that the SIU’s investigation “usually leads to several referrals. The referrals may possibly eventually cause a single docket and a single court circumstance.”
He claimed that 12 issues, that happen to be “around eighty five% comprehensive”, had been remaining jointly investigated because of the Hawks as well as the SIU’s Specialised Financial Functions Unit. (A large number of circumstances, 7 of which were being lodged in 2020, include 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 faced many “troubles” in prosecuting conditions. These, he said, integrated
the lapse of time between in the event the offences were being dedicated along with the issuing on the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary proof” (Previously this year, the SIU explained to the committee that essential documents wanted in some prosecutions were deleted in the NLC computer process or had gone lacking from Metrofile, a warehouse wherever copies of paperwork are archived and stored);
the fact that some implicated individuals are still used by NLC; and
A problem towards the legality of your Presidential Proclamation by former NLC chairperson Alfred Nevhutanda.
“The NPA is dedicated to ensuring finalisation in these matters. To this finish, a staff of dedicated prosecutors is allotted to supervise all NLC issues at present underneath investigation,” de Kock reported. “Issues are taken care of to be a precedence. Once [the] investigations are completed, the NPA will make a call.”
What the companies say (or don’t)
GroundUp was only in the position to get comment from among the list of five businesses accused by the SIU in Parliament of manufacturing fraudulent once-a-year economical statements,TTP Consulting.
Aubrey Moeng, considered one of TTP’s two directors, reported in an electronic mail in response to issues: “Resulting from client confidentiality, we would like to recommend that TTP Consulting isn't ready to disclose shoppers’ monetary confidential facts with the general public or media … without the consent in the consumer or maybe a lawful rationale.”
The company is really a “companion” of numerous state entities, together with SARS and the CIPC, Based on its Site.
Neither of The 2 directors of Dzata Accountants, who will be the two outlined as inactive on the CIPC sign-up of companies, responded to emailed inquiries. The company has actually been deregistered from the CIPC for failing to submit economical statements given that 2021.
The only director of Mageba Ntuli Investing and Consulting Service, Patrick Zulu, died three several years in the past, according to official records. The business was deregistered because of the CIPC for failing to post money statements since 2021.
Matamela Magodi, the only 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 business’s administrators to ask for comment.