The accountants who helped loot the Lottery

The accountants who helped loot the Lottery

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The Exclusive Investigating Unit has identified 5 accounting firms that served loot Lottery funds. Graphic: Lisa Nelson

The Distinctive Investigating Unit has discovered five accounting and auditing firms that assisted non-gain firms loot Lottery money supposed for “very good causes”.
The accounting companies compiled fraudulent economic statements employed by these corporations to submit an application for Lottery funding, the SIU advised Parliament.
Acting chief national investigations officer Zodwa Xesibe mentioned the SIU would take motion to possess these firms blacklisted.
A 4-yr probe via the หวย ลาว ย้อน หลัง Specific Investigating Unit (SIU) has exposed five accounting and auditing companies that aided dodgy non-gain corporations loot many an incredible number of rands designed for “excellent causes” from your Lottery.

These firms ended up explained from the SIU as “Expert enablers,” who “compiled fraudulent financial statements” which were utilized by the companies to submit an application for Lottery funding.

The five companies have been named in Parliament because of the SIU’s acting Main national investigations officer Zodwa Xesibe. They can be TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Expert services.

Fraudulent financials produced by these 5 accounting corporations served approximately 40 businesses get their fingers on lottery funding, based on the SIU presentation.

Based on a Instrument containing details with all lottery grants due to the fact 2002, these companies got more than R314-million in funding.

“These NPCs were being funded by the Nationwide Lotteries Commission (NLC) although the resources were not employed for his or her intended purpose,” Xesibe explained to Parliament’s Trade, Field and Level of competition Portfolio Committee past week.

The SIU, the Hawks and the Nationwide Prosecuting Authority (NPA) had been in Parliament to report back to the committee on development in bringing individuals and organisations involved with looting the lottery to e-book.

Xesibe instructed GroundUp which the SIU intended to lodge problems against the accounting firms included and was examining if these companies have been registered and, If that's so, with which professional bodies.

“We wish these firms for being blacklisted,” she informed GroundUp.

To qualify for Lottery funding, an organisation was needed to develop two a long time of annual economical statements, Xesibe discussed in Parliament.

Nonetheless, as an ongoing six-12 months investigation into lottery corruption by GroundUp has uncovered, hijacked non-financial gain organisations (NPOs) or new shelf non-revenue providers (NPCs) with no fiscal observe data have been accustomed to make an application for funding.

In certain scenarios, Virtually identical monetary statements were being manufactured for unrelated organisations, typically with only the names on the organisations changed, GroundUp’s investigation found.

Paperwork submitted by real NPCs for unsuccessful grant purposes were normally employed by new or hijacked NPCs and NPOs to make an application for funding. The details and documents in the unsuccessful applicants were being supplied by senior Lottery officials to the dodgy applicants.

With cursory or - normally - no verification, these dodgy applicants had been awarded numerous rands in grants. In some cases added tranches of cash had been paid out out devoid of much checking on the development of jobs.

The vast majority of such grants have been created by way of proactive funding, which was at the center in the looting from the lottery. Proactive funding permitted the Minister of Trade, Business and Opposition, or the NLC together with its board, to determine causes to fund without the need of first demanding an application. This was stopped any time a new NLC board was appointed.

R2-billion in grants below investigation
SIU head Advocate Andy Mothibi stated the SIU was at the moment investigating grants valued at over R2-billion, and the unit was even now frequently getting suggestion-offs about additional corruption.

He told MPs that the SIU’s investigation had been broken into three phases: the first, that has been finalised, probed dodgy grants amounting to R280-million, and the 2nd, also finished, concerned R247-million. While in the third section, on account of be finalised at the end of the calendar year, the SIU is investigating grants valued at almost R906-million, involving forty NPOs and NPCs, Mothibi explained.

He stated that the SIU would utilize “shortly” for your Presidential Proclamation, originally granted in October 2020 to research corruption involving lottery grants, to become prolonged to include procurement by the NLC.

The SIU investigation had to this point resulted in 13 disciplinary referrals on the NLC, and administrative referrals to SARS and the Companies and Intellectual Homes Commission to blacklist individuals implicated inside the looting. Issues involving two men and women had been referred on the Authorized Follow Council along with the SA Institute of Chartered Accountants.

The SIU had observed several tendencies under the preceding NLC board and executive - lots of whom have been implicated in looting - Mothibi instructed MPs.

This bundled a “pattern of collusion concerning NLC officials and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “general maladministration from the acceptance of grants,” he stated.

Sluggish progress via the NPA
The SIU has frozen houses, Homes, cars and trucks and various belongings well worth tens of tens of millions which were purchased with lottery money, but MPs expressed concern at slow progress in prosecuting All those linked to the looting. (The SIU is mandated only to Recuperate assets acquired with stolen state funds and doesn't have prosecuting powers).

While the SIU has referred 15 issues on the NPA, thus far only two folks have been brought ahead of a court docket. Two Guys appeared in courtroom in Kimberley lately in reference to misappropriated funds collected for just a undertaking to beat gender-based mostly violence.

In August 2022 Christopher Tshivule was sentenced to 8 a long time in prison for his section within a R1.5-million lottery grant fraud. Fees from two people today billed with him, who the SIU has described as “kingpins” from the corruption that confused the NLC, were being dropped.

Main-Standard Mmeli Makinyane, the acting divisional commissioner for priority offences, told MPs which the Hawks were being currently investigating sixteen lottery corruption-relevant situations. Yet another one - the Kimberley make any difference - is ahead of a court and two are actually sent to your NPA for a decision to prosecute. A further five situations are increasingly being investigated because of the SAPS detective and forensic solutions, he mentioned.

Outlining The explanations for that delay in prosecutions, NPA Deputy Nationwide Director Rodney de Kock mentioned Element of The rationale was the Hawks had to do more investigations after they obtained dossiers through the SIU.

“In essence, the investigations undertaken by the SIU will not satisfy legal expectations for prosecutions.”

As a result, the NPA experienced to operate with investigators from the DPCI (the Hawks) and SAPS to carry out prison investigations and make sure the evidence meets legal prosecution benchmarks, he mentioned, introducing: “Having said that, the get the job done of your SIU is very important and contributes drastically to this process.”

De Kock said which the SIU’s investigation “generally brings about a number of referrals. The referrals may well in the long run lead to 1 docket and one courtroom scenario.”

He reported that 12 issues, which happen to be “somewhere around 85% entire”, have been being jointly investigated because of the Hawks and also the SIU’s Specialised Economic Operations Device. (Most of these situations, seven of which ended up lodged in 2020, involve former NLC chief working officer Phillemon Letwaba, who resigned underneath a cloud in 2022, and Pretoria lawyer Leslie Ramulifho.)

De Kock explained the NPA confronted quite a few “difficulties” in prosecuting circumstances. These, he explained, provided

the lapse of time in between when the offences were being dedicated as well as the issuing in the Presidential Proclamation on one November 2020;
“unavailability of witnesses and/or documentary evidence” (Earlier this calendar year, the SIU instructed the committee that important files essential in some prosecutions had been deleted with the NLC Personal computer method or had absent lacking from Metrofile, a warehouse where copies of documents are archived and stored);
The truth that some implicated persons remain utilized by NLC; and
A problem on the legality of the Presidential Proclamation by previous NLC chairperson Alfred Nevhutanda.
“The NPA is devoted to making certain finalisation in these issues. To this conclusion, a staff of committed prosecutors has long been allotted to oversee all NLC issues at this time less than investigation,” de Kock mentioned. “Issues are managed being a priority. The moment [the] investigations are finished, the NPA could make a decision.”

What the companies say (or don’t)
GroundUp was only capable of get remark from one of several 5 businesses accused via the SIU in Parliament of producing fraudulent annual fiscal statements,TTP Consulting.

Aubrey Moeng, one of TTP’s two administrators, stated in an e-mail in response to queries: “Resulting from customer confidentiality, we prefer to suggest that TTP Consulting just isn't ready to divulge customers’ monetary private information and facts with the public or media … with no consent in the shopper or maybe a authorized reason.”

The corporate can be a “companion” of various state entities, like SARS as well as CIPC, Based on its Internet site.

Neither of The 2 directors of Dzata Accountants, who're both equally stated as inactive over the CIPC sign-up of corporations, responded to emailed issues. The corporate has actually been deregistered via the CIPC for failing to post economic statements given that 2021.

The only real director of Mageba Ntuli Trading and Consulting Company, Patrick Zulu, died three decades ago, In keeping with official data. The company was deregistered with the CIPC for failing to post financial statements considering that 2021.

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

GroundUp was not able to uncover any listing for Tafta Consulting and Accounting Products and services with the CIPC. We were also unable to trace any of the organization’s directors to ask for remark.

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