The accountants who served loot the Lottery

The accountants who served loot the Lottery

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The Distinctive Investigating Device has determined 5 accounting companies that served loot Lottery cash. Graphic: Lisa Nelson

The Particular Investigating Device has recognized 5 accounting and auditing firms that assisted non-revenue businesses loot Lottery dollars supposed for “good leads to”.
The accounting firms compiled fraudulent money statements used by these providers to make an application for Lottery funding, the SIU informed Parliament.
Acting Main national investigations officer Zodwa Xesibe reported the SIU would acquire motion to have these companies blacklisted.
A 4-yr probe through the fox888 Unique Investigating Device (SIU) has uncovered five accounting and auditing corporations that served dodgy non-revenue providers loot numerous countless rands meant for “superior results in” through the Lottery.

These corporations were explained via the SIU as “Qualified enablers,” who “compiled fraudulent monetary statements” that were employed by the businesses to make an application for Lottery funding.

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

Fraudulent financials produced by these 5 accounting corporations served virtually forty businesses get their fingers on lottery funding, in accordance with the SIU presentation.

Depending on a Device that contains facts with all lottery grants because 2002, these businesses bought about R314-million in funding.

“These NPCs have been funded with the Nationwide Lotteries Fee (NLC) but the cash weren't employed for his or her intended goal,” Xesibe instructed Parliament’s Trade, Field and Level of competition Portfolio Committee last week.

The SIU, the Hawks as well as the National Prosecuting Authority (NPA) ended up in Parliament to report back to the committee on progress in bringing persons and organisations associated with looting the lottery to ebook.

Xesibe informed GroundUp that the SIU intended to lodge grievances from the accounting corporations concerned and was checking if these corporations were being registered and, If that's so, with which Experienced bodies.

“We would like these firms for being blacklisted,” she told GroundUp.

To qualify for Lottery funding, an organisation was necessary to produce two many years of once-a-year economic statements, Xesibe stated in Parliament.

Nonetheless, as an ongoing six-yr investigation into lottery corruption by GroundUp has discovered, hijacked non-profit organisations (NPOs) or new shelf non-earnings corporations (NPCs) with no monetary observe documents had been accustomed to submit an application for funding.

In a few circumstances, Practically identical financial statements ended up made for unrelated organisations, frequently with just the names from the organisations altered, GroundUp’s investigation uncovered.

Documents submitted by real NPCs for unsuccessful grant applications ended up generally used by new or hijacked NPCs and NPOs to make an application for funding. The details and paperwork of your unsuccessful applicants had been provided by senior Lottery officials to your dodgy applicants.

With cursory or - often - no verification, these dodgy applicants have been awarded numerous rands in grants. From time to time more tranches of money were paid out out with out Considerably examining to the development of assignments.

The vast majority of these grants were built by means of proactive funding, which was at the heart of the looting of your lottery. Proactive funding permitted the Minister of Trade, Business and Level of competition, or perhaps the NLC along with its board, to identify will cause to fund with no very first requiring an application. This was stopped each time a new NLC board was appointed.

R2-billion in grants less than investigation
SIU head Advocate Andy Mothibi reported the SIU was at this time investigating grants valued at around R2-billion, and also the device was still often getting tip-offs about much more corruption.

He advised MPs that the SIU’s investigation had been broken into a few phases: the first, that has been finalised, probed dodgy grants amounting to R280-million, and the second, also done, included R247-million. While in the 3rd period, resulting from be finalised at the end of the calendar year, the SIU is investigating grants valued at Just about R906-million, involving 40 NPOs and NPCs, Mothibi claimed.

He said the SIU would implement “before long” for your Presidential Proclamation, initially granted in Oct 2020 to investigate corruption involving lottery grants, to get prolonged to incorporate procurement via the NLC.

The SIU investigation had up to now brought about thirteen disciplinary referrals towards the NLC, and administrative referrals to SARS and the Companies and Mental Attributes Fee to blacklist people today implicated during the looting. Complaints involving two folks had been referred towards the Legal Practice Council and also the SA Institute of Chartered Accountants.

The SIU experienced observed quite a few tendencies under the previous NLC board and government - most of whom are already implicated in looting - Mothibi informed MPs.

This bundled a “pattern of collusion involving NLC officers and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “typical maladministration inside the approval of grants,” he mentioned.

Sluggish progress because of the NPA
The SIU has frozen homes, Qualities, automobiles and various belongings truly worth tens of millions which were purchased with lottery money, but MPs expressed worry at sluggish progress in prosecuting Those people involved with the looting. (The SIU is mandated only to Recuperate belongings bought with stolen point out money and doesn't have prosecuting powers).

Although the SIU has referred fifteen issues for the NPA, to this point only two people have been introduced just before a courtroom. Two Adult males appeared in court in Kimberley just lately in reference to misappropriated funds collected for the job to combat gender-primarily based violence.

In August 2022 Christopher Tshivule was sentenced to eight a long time in prison for his element in a R1.5-million lottery grant fraud. Prices versus two people charged with him, who the SIU has described as “kingpins” inside the corruption that overwhelmed the NLC, had been dropped.

Major-Normal Mmeli Makinyane, the acting divisional commissioner for precedence offences, told MPs which the Hawks ended up at present investigating sixteen lottery corruption-connected conditions. Another just one - the Kimberley make a difference - is before a courtroom and two have been sent on the NPA for a call to prosecute. An extra 5 conditions are increasingly being investigated by the SAPS detective and forensic companies, he said.

Detailing the reasons for your hold off in prosecutions, NPA Deputy Nationwide Director Rodney de Kock explained Element of The key reason why was the Hawks needed to do further more investigations every time they acquired dossiers from your SIU.

“In essence, the investigations carried out with the SIU usually do not fulfill legal benchmarks for prosecutions.”

For that reason, the NPA experienced to work with investigators while in the DPCI (the Hawks) and SAPS to conduct legal investigations and make sure the proof satisfies criminal prosecution criteria, he said, adding: “That said, the operate of the SIU is significant and contributes significantly to this process.”

De Kock mentioned which the SIU’s investigation “normally brings about multiple referrals. The referrals may ultimately end in a single docket and 1 court circumstance.”

He mentioned that twelve matters, which are “somewhere around 85% complete”, were being currently being jointly investigated by the Hawks as well as SIU’s Specialised Economic Operations Unit. (These types of cases, seven of which have been lodged in 2020, require former NLC Main operating officer Phillemon Letwaba, who resigned underneath a cloud in 2022, and Pretoria law firm Leslie Ramulifho.)

De Kock stated the NPA faced many “issues” in prosecuting situations. These, he mentioned, bundled

the lapse of your time among when the offences ended up dedicated along with the issuing from the Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary proof” (Earlier this yr, the SIU informed the committee that vital documents essential in certain prosecutions had been deleted with the NLC Pc technique or had gone lacking from Metrofile, a warehouse where copies of files are archived and saved);
The reality that some implicated men and women are still employed by NLC; and
A obstacle to your legality on the Presidential Proclamation by former NLC chairperson Alfred Nevhutanda.
“The NPA is dedicated to making certain finalisation in these issues. To this conclusion, a crew of dedicated prosecutors continues to be allotted to oversee all NLC issues at present below investigation,” de Kock stated. “Issues are taken care of being a precedence. Once [the] investigations are accomplished, the NPA could make a call.”

What the companies say (or don’t)
GroundUp was only able to get comment from on the list of five corporations accused by the SIU in Parliament of producing fraudulent annual economic statements,TTP Consulting.

Aubrey Moeng, one among TTP’s two directors, claimed within an electronic mail in response to inquiries: “Due to client confidentiality, we wish to recommend that TTP Consulting will not be ready to disclose shoppers’ fiscal confidential information with the general public or media … without the consent with the client or a authorized purpose.”

The corporate is really a “lover” of a number of point out entities, including SARS as well as the CIPC, In keeping with its website.

Neither of the two directors of Dzata Accountants, who will be each shown as inactive around the CIPC register of firms, responded to emailed thoughts. The company continues to be deregistered from the CIPC for failing to submit monetary statements because 2021.

The sole director of Mageba Ntuli Investing and Consulting Support, Patrick Zulu, died three years in the past, In line with Formal information. The organization was deregistered via the CIPC for failing to submit fiscal statements given that 2021.

Matamela Magodi, the only real director of Magodi Consultants, did not respond to thoughts emailed to him.

GroundUp was unable to uncover any listing for Tafta Consulting and Accounting Services With all the CIPC. We have been also not able to trace any of the corporate’s directors to ask for remark.

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