The accountants who helped loot the Lottery
The accountants who helped loot the Lottery
Blog Article
The Special Investigating Unit has identified 5 accounting firms that aided loot Lottery resources. Graphic: Lisa Nelson
The Specific Investigating Device has identified 5 accounting and auditing corporations that served non-financial gain firms loot Lottery income intended for “fantastic brings about”.
The accounting companies compiled fraudulent economical statements employed by these providers to submit an application for Lottery funding, the SIU explained to Parliament.
Performing chief national investigations officer Zodwa Xesibe said the SIU would just take motion to get these firms blacklisted.
A 4-year probe by the ltpbet Particular Investigating Unit (SIU) has exposed 5 accounting and auditing companies that assisted dodgy non-earnings organizations loot numerous numerous rands meant for “superior will cause” through the Lottery.
These corporations have been described with the SIU as “Expert enablers,” who “compiled fraudulent economical statements” that were utilized by the businesses to apply for Lottery funding.
The five firms were being named in Parliament through the SIU’s acting chief nationwide investigations officer Zodwa Xesibe. They are really TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Solutions.
Fraudulent financials produced by these five accounting corporations served approximately forty providers get their arms on lottery funding, in accordance with the SIU presentation.
Based upon a Resource that contains information with all lottery grants given that 2002, these businesses bought about R314-million in funding.
“These NPCs had been funded by the Nationwide Lotteries Fee (NLC) even so the funds were not made use of for their meant intent,” Xesibe informed Parliament’s Trade, Marketplace and Opposition Portfolio Committee very last 7 days.
The SIU, the Hawks and the National Prosecuting Authority (NPA) had been in Parliament to report to the committee on progress in bringing folks and organisations involved with looting the lottery to ebook.
Xesibe instructed GroundUp the SIU intended to lodge complaints against the accounting corporations included and was checking if these corporations were being registered and, If that is so, with which Specialist bodies.
“We want these companies being blacklisted,” she advised GroundUp.
To qualify for Lottery funding, an organisation was required to make two many years of yearly financial statements, Xesibe spelled out in Parliament.
Nevertheless, as an ongoing 6-calendar year investigation into lottery corruption by GroundUp has exposed, hijacked non-income organisations (NPOs) or new shelf non-gain businesses (NPCs) without any economic observe information were being accustomed to apply for funding.
In certain occasions, almost similar fiscal statements ended up manufactured for unrelated organisations, typically with just the names in the organisations modified, GroundUp’s investigation observed.
Documents submitted by genuine NPCs for unsuccessful grant applications had been often used by new or hijacked NPCs and NPOs to submit an application for funding. The main points and documents from the unsuccessful applicants were being supplied by senior Lottery officers on the dodgy applicants.
With cursory or - generally - no verification, these dodgy applicants had been awarded millions of rands in grants. At times extra tranches of funds were being paid out without the need of Substantially examining around the progress of assignments.
The vast majority of these grants were made via proactive funding, which was at the guts with the looting with the lottery. Proactive funding permitted the Minister of Trade, Market and Levels of competition, or even the NLC together with its board, to identify will cause to fund with no initial necessitating an software. This was stopped whenever a new NLC board was appointed.
R2-billion in grants underneath investigation
SIU head Advocate Andy Mothibi said the SIU was at the moment investigating grants valued at over R2-billion, as well as the unit was continue to regularly receiving tip-offs about much more corruption.
He informed MPs that the SIU’s investigation had been damaged into 3 phases: the 1st, which has been finalised, probed dodgy grants amounting to R280-million, and the second, also completed, involved R247-million. In the 3rd stage, because of be finalised at the conclusion of the 12 months, the SIU is investigating grants valued at Virtually R906-million, involving forty NPOs and NPCs, Mothibi explained.
He stated the SIU would apply “shortly” for the Presidential Proclamation, initially granted in Oct 2020 to analyze corruption involving lottery grants, to get prolonged to incorporate procurement through the NLC.
The SIU investigation experienced to this point led to 13 disciplinary referrals for the NLC, and administrative referrals to SARS and the businesses and Mental Houses Fee to blacklist people today implicated in the looting. Complaints involving two people were referred into the Lawful Exercise Council plus the SA Institute of Chartered Accountants.
The SIU had observed quite a few tendencies under the previous NLC board and govt - a lot of whom happen to be implicated in looting - Mothibi explained to MPs.
This involved a “trend of collusion concerning NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “normal maladministration within the acceptance of grants,” he said.
Sluggish progress via the NPA
The SIU has frozen houses, Houses, cars and trucks and also other belongings truly worth tens of millions that were bought with lottery resources, but MPs expressed issue at gradual development in prosecuting People involved with the looting. (The SIU is mandated only to Get well assets acquired with stolen condition money and does not have prosecuting powers).
Though the SIU has referred fifteen matters into the NPA, thus far only two people have been introduced ahead of a court docket. Two Gentlemen appeared in court in Kimberley not long ago in connection with misappropriated cash gathered to get a challenge to fight gender-dependent violence.
In August 2022 Christopher Tshivule was sentenced to 8 a long time in jail for his section inside a R1.5-million lottery grant fraud. Expenses from two people today billed with him, who the SIU has called “kingpins” in the corruption that overwhelmed the NLC, were dropped.
Significant-Common Mmeli Makinyane, the acting divisional commissioner for precedence offences, instructed MPs the Hawks had been presently investigating sixteen lottery corruption-linked scenarios. One more a single - the Kimberley matter - is right before a courtroom and two have been despatched to the NPA for a choice to prosecute. An extra five scenarios are being investigated with the SAPS detective and forensic services, he explained.
Conveying the reasons for your delay in prosecutions, NPA Deputy National Director Rodney de Kock mentioned Component of The key reason why was which the Hawks needed to do even further investigations every time they been given dossiers within the SIU.
“In essence, the investigations carried out with the SIU tend not to satisfy prison 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 make sure the evidence fulfills prison prosecution expectations, he reported, including: “Having said that, the work on the SIU is important and contributes tremendously to this method.”
De Kock claimed which the SIU’s investigation “often results in numerous referrals. The referrals could eventually cause just one docket and just one courtroom situation.”
He stated that twelve issues, that happen to be “around 85% entire”, ended up getting jointly investigated from the Hawks and the SIU’s Specialised Economic Functions Device. (Many of these scenarios, seven of which had been lodged in 2020, contain previous NLC chief working officer Phillemon Letwaba, who resigned underneath a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)
De Kock said the NPA faced numerous “issues” in prosecuting conditions. These, he reported, integrated
the lapse of time between when the offences were being fully commited plus the issuing with the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary proof” (Previously this yr, the SIU told the committee that vital files required in a few prosecutions were deleted from the NLC Laptop procedure or had gone missing from Metrofile, a warehouse the place copies of paperwork are archived and saved);
The reality that some implicated people today remain used by NLC; and
A problem to your legality with the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is devoted to making certain finalisation in these matters. To this end, a workforce of committed prosecutors has become allocated to supervise all NLC matters presently under investigation,” de Kock claimed. “Matters are taken care of being a precedence. The moment [the] investigations are finished, the NPA could make a decision.”
What the businesses say (or don’t)
GroundUp was only in a position to get comment from one of the five corporations accused by the SIU in Parliament of producing fraudulent yearly money statements,TTP Consulting.
Aubrey Moeng, certainly one of TTP’s two directors, mentioned in an e-mail in response to inquiries: “Resulting from shopper confidentiality, we need to recommend that TTP Consulting will not be ready to divulge customers’ monetary private information and facts with the general public or media … without the consent of your customer or even a legal motive.”
The business is really a “husband or wife” of many point out entities, like SARS and also the CIPC, As outlined by its Web site.
Neither of the two administrators of Dzata Accountants, who will be each shown as inactive over the CIPC register of businesses, responded to emailed inquiries. The corporate has long been deregistered by the CIPC for failing to post economical statements since 2021.
The only real director of Mageba Ntuli Investing and Consulting Assistance, Patrick Zulu, died 3 a long time ago, In keeping with Formal records. The corporation was deregistered with the CIPC for failing to submit money statements considering that 2021.
Matamela Magodi, the sole director of Magodi Consultants, did not reply to concerns emailed to him.
GroundUp was not able to find any listing for Tafta Consulting and Accounting Expert services Using the CIPC. We ended up also struggling to trace any of the company’s directors to ask for comment.