The accountants who served loot the Lottery
The accountants who served loot the Lottery
Blog Article
The Specific Investigating Unit has determined five accounting firms that served loot Lottery funds. Graphic: Lisa Nelson
The Special Investigating Unit has determined 5 accounting and auditing firms that served non-income corporations loot Lottery income intended for “excellent causes”.
The accounting companies compiled fraudulent financial statements used by these corporations to apply for Lottery funding, the SIU instructed Parliament.
Performing chief national investigations officer Zodwa Xesibe said the SIU would consider action to own these companies blacklisted.
A 4-12 months probe by the fox888 Distinctive Investigating Device (SIU) has uncovered 5 accounting and auditing corporations that served dodgy non-revenue companies loot numerous numerous rands meant for “good leads to” with the Lottery.
These companies were being described by the SIU as “Experienced enablers,” who “compiled fraudulent economical statements” that were used by the businesses to apply for Lottery funding.
The 5 businesses have been named in Parliament via the SIU’s acting chief nationwide investigations officer Zodwa Xesibe. These are TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Solutions.
Fraudulent financials made by these 5 accounting corporations helped practically forty companies get their arms on lottery funding, according to the SIU presentation.
Based on a Resource made up of facts with all lottery grants due to the fact 2002, these providers received in excess of R314-million in funding.
“These NPCs ended up funded through the Nationwide Lotteries Fee (NLC) even so the resources weren't used for his or her supposed objective,” Xesibe told Parliament’s Trade, Field and Opposition Portfolio Committee very last 7 days.
The SIU, the Hawks and the National Prosecuting Authority (NPA) were being in Parliament to report to the committee on development in bringing people and organisations associated with looting the lottery to e-book.
Xesibe instructed GroundUp which the SIU meant to lodge grievances in opposition to the accounting corporations associated and was examining if these companies have been registered and, If that's the case, with which Skilled bodies.
“We want these businesses to become blacklisted,” she explained to GroundUp.
To qualify for Lottery funding, an organisation was needed to develop two decades of yearly monetary statements, Xesibe explained in Parliament.
However, being an ongoing six-year investigation into lottery corruption by GroundUp has exposed, hijacked non-profit organisations (NPOs) or new shelf non-financial gain organizations (NPCs) with no fiscal observe records were used to make an application for funding.
In a few occasions, almost identical fiscal statements ended up produced for unrelated organisations, often with only the names with the organisations changed, GroundUp’s investigation identified.
Documents submitted by genuine NPCs for unsuccessful grant applications were often employed by new or hijacked NPCs and NPOs to make an application for funding. The details and documents from the unsuccessful applicants ended up equipped by senior Lottery officials to the dodgy applicants.
With cursory or - often - no verification, these dodgy applicants have been awarded numerous rands in grants. Sometimes supplemental tranches of money ended up paid out out without the need of Considerably examining within the progress of projects.
The overwhelming majority of such grants have been manufactured through proactive funding, which was at the guts with the looting on the lottery. Proactive funding allowed the Minister of Trade, Industry and Competition, or even the NLC at the side of its board, to discover causes to fund with no initially demanding an application. This was stopped every time a new NLC board was appointed.
R2-billion in grants beneath investigation
SIU head Advocate Andy Mothibi claimed the SIU was presently investigating grants valued at above R2-billion, and the device was continue to on a regular basis acquiring suggestion-offs about far more corruption.
He told MPs which the SIU’s investigation were broken into three phases: the main, which has been finalised, probed dodgy grants amounting to R280-million, and the next, also concluded, involved R247-million. While in the third period, because of be finalised at the end of the yr, the SIU is investigating grants valued at Pretty much R906-million, involving forty NPOs and NPCs, Mothibi reported.
He reported which the SIU would utilize “shortly” for that Presidential Proclamation, initially granted in October 2020 to analyze corruption involving lottery grants, being extended to incorporate procurement via the NLC.
The SIU investigation experienced up to now led to 13 disciplinary referrals to the NLC, and administrative referrals to SARS and the businesses and Intellectual Attributes Commission to blacklist people today implicated while in the looting. Problems involving two men and women were referred for the Authorized Practice Council along with the SA Institute of Chartered Accountants.
The SIU experienced noticed a number of developments beneath the preceding NLC board and government - lots of whom happen to be implicated in looting - Mothibi informed MPs.
This provided a “craze of collusion involving NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “standard maladministration while in the approval of grants,” he mentioned.
Sluggish development via the NPA
The SIU has frozen residences, Houses, automobiles along with other assets worthy of tens of hundreds of thousands which were bought with lottery cash, but MPs expressed concern at sluggish development in prosecuting All those involved in the looting. (The SIU is mandated only to Recuperate property bought with stolen condition resources and doesn't have prosecuting powers).
Whilst the SIU has referred 15 matters to your NPA, to this point only two individuals have been introduced just before a courtroom. Two Adult men appeared in court docket in Kimberley just lately in connection with misappropriated resources gathered for the project to battle gender-centered violence.
In August 2022 Christopher Tshivule was sentenced to eight yrs in jail for his part inside a R1.5-million lottery grant fraud. Costs towards two men and women charged with him, who the SIU has described as “kingpins” during the corruption that overcome the NLC, had been dropped.
Major-Typical Mmeli Makinyane, the acting divisional commissioner for precedence offences, instructed MPs that the Hawks ended up at the moment investigating sixteen lottery corruption-connected conditions. A further one particular - the Kimberley issue - is before a courtroom and two have already been despatched on the NPA for a choice to prosecute. A further five conditions are increasingly being investigated by the SAPS detective and forensic companies, he claimed.
Outlining The explanations for the delay in prosecutions, NPA Deputy Countrywide Director Rodney de Kock said A part of The main reason was that the Hawks needed to do even more investigations if they acquired dossiers in the SIU.
“In essence, the investigations carried out from the SIU do not satisfy felony specifications for prosecutions.”
Thus, the NPA had to operate with investigators within the DPCI (the Hawks) and SAPS to carry out prison investigations and be certain that the proof satisfies criminal prosecution benchmarks, he explained, introducing: “Having said that, the operate of the SIU is vital and contributes considerably to this method.”
De Kock explained the SIU’s investigation “typically leads to several referrals. The referrals may possibly eventually cause a single docket and a single court circumstance.”
He claimed that 12 issues, which can be “around 85% complete”, have been being jointly investigated because of the Hawks plus the SIU’s Specialised Financial Operations Unit. (A large number of circumstances, seven of which ended up lodged in 2020, contain previous NLC Main functioning officer Phillemon Letwaba, who resigned below a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)
De Kock stated the NPA confronted several “challenges” in prosecuting situations. These, he explained, involved
the lapse of your time among when the offences were being dedicated as well as the issuing from the Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary evidence” (Before this yr, the SIU informed the committee that key files essential in certain prosecutions had been deleted within the NLC Personal computer process or experienced long gone lacking from Metrofile, a warehouse where copies of documents are archived and saved);
The truth that some implicated men and women remain used by NLC; and
A obstacle towards the legality on the Presidential Proclamation by former NLC chairperson Alfred Nevhutanda.
“The NPA is committed to ensuring finalisation in these issues. To this conclude, a group of dedicated prosecutors has been allotted to oversee all NLC issues at present under investigation,” de Kock reported. “Matters are managed like a precedence. When [the] investigations are done, the NPA can make a choice.”
What the companies say (or don’t)
GroundUp was only capable to get remark from among the list of 5 companies accused because of the SIU in Parliament of manufacturing fraudulent once-a-year economical statements,TTP Consulting.
Aubrey Moeng, one among TTP’s two directors, mentioned in an email in reaction to thoughts: “Because of client confidentiality, we want to advise that TTP Consulting is not prepared to divulge clientele’ monetary private facts with the public or media … with no consent from the shopper or possibly a legal explanation.”
The business is usually a “associate” of quite a few state entities, which include SARS and also the CIPC, In keeping with its website.
Neither of the two directors of Dzata Accountants, who are the two shown as inactive to the CIPC sign-up of corporations, responded to emailed issues. The corporate has long been deregistered because of the CIPC for failing to submit economic statements considering that 2021.
The sole director of Mageba Ntuli Investing and Consulting Assistance, Patrick Zulu, died 3 many years back, In line with Formal information. The corporation was deregistered with the CIPC for failing to post monetary statements due to the fact 2021.
Matamela Magodi, the only real director of Magodi Consultants, did not respond to queries emailed to him.
GroundUp was not able to obtain any listing for Tafta Consulting and Accounting Providers Along with the CIPC. We were also struggling to trace any of the corporation’s administrators to ask for comment.
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