The accountants who assisted loot the Lottery

The accountants who assisted loot the Lottery

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The Unique Investigating Device has determined five accounting corporations that aided loot Lottery funds. Graphic: Lisa Nelson

The Unique Investigating Device has determined five accounting and auditing corporations that helped non-gain providers loot Lottery income supposed for “very good results in”.
The accounting firms compiled fraudulent economic statements utilized by these corporations to make an application for Lottery funding, the SIU instructed Parliament.
Acting chief countrywide investigations officer Zodwa Xesibe reported the SIU would choose motion to have these firms blacklisted.
A 4-calendar year probe by the ltpbet Distinctive Investigating Unit (SIU) has exposed 5 accounting and auditing companies that aided dodgy non-financial gain companies loot countless millions of rands meant for “great brings about” through the Lottery.

These firms had been explained because of the SIU as “professional enablers,” who “compiled fraudulent monetary statements” which were utilized by the businesses to make an application for Lottery funding.

The 5 firms have been named in Parliament from the SIU’s acting chief countrywide investigations officer Zodwa Xesibe. They may be TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Expert services.

Fraudulent financials made by these five accounting corporations helped just about forty businesses get their palms on lottery funding, in accordance with the SIU presentation.

Depending on a Instrument containing information with all lottery grants given that 2002, these corporations bought about R314-million in funding.

“These NPCs have been funded through the Countrywide Lotteries Commission (NLC) but the funds weren't utilized for their supposed purpose,” Xesibe informed Parliament’s Trade, Sector and Levels of competition Portfolio Committee final week.

The SIU, the Hawks along with the Nationwide Prosecuting Authority (NPA) had been 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 the SIU intended to lodge problems from the accounting companies associated and was examining if these firms were being registered and, If that is so, with which Specialist bodies.

“We wish these firms to get blacklisted,” she explained to GroundUp.

To qualify for Lottery funding, an organisation was required to make two several years of annual economic statements, Xesibe stated in Parliament.

Even so, as an ongoing 6-calendar year investigation into lottery corruption by GroundUp has exposed, hijacked non-income organisations (NPOs) or new shelf non-income corporations (NPCs) without having monetary track documents were being accustomed to submit an application for funding.

In some scenarios, Just about equivalent fiscal statements had been created for unrelated organisations, normally with only the names of your organisations transformed, GroundUp’s investigation discovered.

Files submitted by real NPCs for unsuccessful grant applications have been normally used by new or hijacked NPCs and NPOs to apply for funding. The details and files of your unsuccessful applicants had been supplied by senior Lottery officers into the dodgy applicants.

With cursory or - often - no verification, these dodgy applicants were being awarded many rands in grants. Often further tranches of resources had been paid out out with no Considerably checking over the progress of initiatives.

The overwhelming majority of these grants ended up produced through proactive funding, which was at the center on the looting with the lottery. Proactive funding authorized the Minister of Trade, Field and Competitiveness, or perhaps the NLC along side its board, to detect results in to fund without the need of to start with demanding an application. This was stopped whenever a new NLC board was appointed.

R2-billion in grants underneath investigation
SIU head Advocate Andy Mothibi claimed the SIU was currently investigating grants valued at around R2-billion, as well as unit was nonetheless consistently acquiring tip-offs about more corruption.

He instructed MPs that the SIU’s investigation had been broken into 3 phases: the first, which has been finalised, probed dodgy grants amounting to R280-million, and the next, also done, involved R247-million. From the third stage, resulting from be finalised at the conclusion of the 12 months, the SIU is investigating grants valued at Just about R906-million, involving 40 NPOs and NPCs, Mothibi stated.

He reported the SIU would apply “before long” to the Presidential Proclamation, at first granted in October 2020 to research corruption involving lottery grants, to become prolonged to incorporate procurement with the NLC.

The SIU investigation experienced up to now resulted in 13 disciplinary referrals to your NLC, and administrative referrals to SARS and the businesses and Mental Houses Fee to blacklist people today implicated in the looting. Grievances involving two men and women had been referred for the Authorized Follow Council along with the SA Institute of Chartered Accountants.

The SIU had observed several trends under the preceding NLC board and government - many of whom have been implicated in looting - Mothibi told MPs.

This included a “development of collusion amongst NLC officers and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “normal maladministration inside the acceptance of grants,” he stated.

Sluggish development through the NPA
The SIU has frozen homes, Homes, cars and other assets value tens of tens of millions which were acquired with lottery cash, but MPs expressed issue at gradual progress in prosecuting People involved with the looting. (The SIU is mandated only to Get well property bought with stolen state funds and does not have prosecuting powers).

Whilst the SIU has referred fifteen matters to the NPA, thus far only two individuals have been introduced in advance of a court. Two Adult males appeared in court in Kimberley a short while ago in reference to misappropriated money gathered to get a job to fight gender-dependent violence.

In August 2022 Christopher Tshivule was sentenced to eight yrs in jail for his element inside of a R1.5-million lottery grant fraud. Fees against two persons billed with him, who the SIU has described as “kingpins” while in the corruption that overcome the NLC, ended up dropped.

Major-Standard Mmeli Makinyane, the acting divisional commissioner for priority offences, told MPs which the Hawks ended up at this time investigating 16 lottery corruption-associated cases. A further just one - the Kimberley issue - is just before a court docket and two are already despatched for the NPA for a call to prosecute. A further five scenarios are being investigated through the SAPS detective and forensic products and services, he stated.

Outlining The explanations with the hold off in prosecutions, NPA Deputy Countrywide Director Rodney de Kock stated Section of the reason was that the Hawks had to do more investigations if they been given dossiers from the SIU.

“In essence, the investigations carried out by the SIU don't fulfill felony criteria for prosecutions.”

Therefore, the NPA experienced to work with investigators in the DPCI (the Hawks) and SAPS to conduct criminal investigations and make sure that the proof satisfies legal prosecution requirements, he stated, introducing: “That said, the work with the SIU is significant and contributes drastically to this method.”

De Kock stated the SIU’s investigation “generally results in a number of referrals. The referrals may perhaps ultimately lead to one docket and a person courtroom scenario.”

He claimed that twelve matters, which happen to be “around 85% comprehensive”, ended up remaining jointly investigated through the Hawks as well as SIU’s Specialised Financial Functions Unit. (The majority of these situations, seven of which were being lodged in 2020, contain former NLC Main running officer Phillemon Letwaba, who resigned below a cloud in 2022, and Pretoria lawyer Leslie Ramulifho.)

De Kock said the NPA faced quite a few “issues” in prosecuting situations. These, he stated, involved

the lapse of time amongst when the offences were being dedicated and the issuing in the Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary proof” (Previously this 12 months, the SIU instructed the committee that critical paperwork desired in a few prosecutions were deleted in the NLC Laptop or computer process or had long gone missing from Metrofile, a warehouse where copies of paperwork are archived and stored);
The point that some implicated people today are still utilized by NLC; and
A challenge to your legality in the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is committed to guaranteeing finalisation in these issues. To this conclude, a group of committed prosecutors continues to be allocated to oversee all NLC matters currently below investigation,” de Kock explained. “Matters are taken care of as being a priority. The moment [the] investigations are completed, the NPA is likely to make a choice.”

What the companies say (or don’t)
GroundUp was only capable to get comment from one of the 5 providers accused via the SIU in Parliament of manufacturing fraudulent annual economic statements,TTP Consulting.

Aubrey Moeng, one among TTP’s two administrators, claimed in an e mail in reaction to inquiries: “As a result of customer confidentiality, we want to suggest that TTP Consulting is not really willing to divulge consumers’ financial confidential facts with the general public or media … without the consent in the customer or a legal cause.”

The corporate is actually a “spouse” of many condition entities, together with SARS as well as CIPC, In accordance with its Site.

Neither of The 2 directors of Dzata Accountants, who are both equally stated as inactive to the CIPC register of providers, responded to emailed inquiries. The company has actually been deregistered through the CIPC for failing to submit monetary statements due to the fact 2021.

The sole director of Mageba Ntuli Investing and Consulting Services, Patrick Zulu, died three yrs back, Based on official records. The organization was deregistered with the CIPC for failing to submit economic statements considering the fact that 2021.

Matamela Magodi, the only real director of Magodi Consultants, didn't respond to concerns emailed to him.

GroundUp was unable to discover any listing for Tafta Consulting and Accounting Companies While using the CIPC. We were being also not able to trace any of the organization’s administrators to ask for comment.