The Distinctive Investigating Unit has recognized 5 accounting firms that aided loot Lottery funds. Graphic: Lisa Nelson

The Specific Investigating Device has determined 5 accounting and auditing companies that assisted non-gain organizations loot Lottery money intended for “very good will cause”.
The accounting corporations compiled fraudulent monetary statements employed by these businesses to make an application for Lottery funding, the SIU instructed Parliament.
Performing chief national investigations officer Zodwa Xesibe said the SIU would just take motion to acquire these companies blacklisted.
A four-calendar year probe with the ruay Special Investigating Device (SIU) has uncovered five accounting and auditing firms that assisted dodgy non-profit firms loot many hundreds of numerous rands meant for “superior results in” from the Lottery.

These corporations have been explained because of the SIU as “Skilled enablers,” who “compiled fraudulent monetary statements” which were used by the businesses to make an application for Lottery funding.

The five providers have been named in Parliament because of the SIU’s acting chief national investigations officer Zodwa Xesibe. These are TTP Consulting, Dzata Accountants, Magodi Consulting, Mageba Ntuli Consulting and Tafta Consulting and Accounting Expert services.

Fraudulent financials produced by these five accounting companies aided approximately 40 organizations get their hands on lottery funding, based on the SIU presentation.

Based upon a tool that contains details with all lottery grants since 2002, these providers received over R314-million in funding.

“These NPCs have been funded because of the Countrywide Lotteries Commission (NLC) although the cash were not utilized for his or her supposed purpose,” Xesibe told Parliament’s Trade, Marketplace and Levels of competition Portfolio Committee last week.

The SIU, the Hawks plus the Countrywide Prosecuting Authority (NPA) were being in Parliament to report back to the committee on progress in bringing men and women and organisations involved with looting the lottery to e-book.

Xesibe advised GroundUp that the SIU meant to lodge issues in opposition to the accounting firms included and was examining if these companies were registered and, if so, with which Experienced bodies.

“We want these providers to get blacklisted,” she told GroundUp.

To qualify for Lottery funding, an organisation was needed to create two several years of annual fiscal statements, Xesibe explained in Parliament.

Having said that, being an ongoing 6-calendar year investigation into lottery corruption by GroundUp has uncovered, hijacked non-income organisations (NPOs) or new shelf non-income firms (NPCs) without economic monitor records had been used to submit an application for funding.

In a few circumstances, Nearly equivalent economic statements had been manufactured for unrelated organisations, typically with only the names with the organisations modified, GroundUp’s investigation discovered.

Paperwork submitted by authentic NPCs for unsuccessful grant applications had been normally used by new or hijacked NPCs and NPOs to submit an application for funding. The small print and documents on the unsuccessful applicants were supplied by senior Lottery officers into the dodgy applicants.

With cursory or - usually - no verification, these dodgy applicants ended up awarded an incredible number of rands in grants. In some cases extra tranches of money have been paid out without having Considerably checking to the development of jobs.

The overwhelming majority of those grants have been designed by means of proactive funding, which was at the guts from the looting in the lottery. Proactive funding allowed the Minister of Trade, Business and Opposition, or maybe the NLC along side its board, to identify will cause to fund without 1st demanding an application. This was stopped every time a new NLC board was appointed.

R2-billion in grants underneath investigation
SIU head Advocate Andy Mothibi said the SIU was at present investigating grants valued at above R2-billion, plus the unit was nevertheless routinely getting idea-offs about additional corruption.

He instructed MPs the SIU’s investigation were damaged into three phases: the very first, that has been finalised, probed dodgy grants amounting to R280-million, and the next, also done, associated R247-million. Inside the 3rd section, on account of be finalised at the end of the yr, the SIU is investigating grants valued at Virtually R906-million, involving forty NPOs and NPCs, Mothibi explained.

He stated the SIU would apply “quickly” with the Presidential Proclamation, at first granted in Oct 2020 to investigate corruption involving lottery grants, to get prolonged to incorporate procurement by the NLC.

The SIU investigation had so far resulted in 13 disciplinary referrals into the NLC, and administrative referrals to SARS and the businesses and Intellectual Homes Commission to blacklist people implicated from the looting. Grievances involving two people today had been referred towards the Lawful Exercise Council plus the SA Institute of Chartered Accountants.

The SIU had noticed a number of trends beneath the earlier NLC board and executive - lots of whom are implicated in looting - Mothibi advised MPs.

This included a “pattern of collusion involving NLC officers and NPOs and NPCs”, “the hijacking of NPOs and NPCs” and “basic maladministration in the approval of grants,” he mentioned.

Sluggish progress via the NPA
The SIU has frozen homes, Homes, cars and trucks along with other belongings worthy of tens of millions which were acquired with lottery cash, but MPs expressed problem at slow progress in prosecuting These involved in the looting. (The SIU is mandated only to Recuperate assets purchased with stolen state resources and doesn't have prosecuting powers).

Even though the SIU has referred 15 matters to the NPA, to this point only two individuals have been brought right before a court. Two Gentlemen appeared in courtroom in Kimberley just lately in reference to misappropriated cash gathered for any undertaking to battle gender-based mostly violence.

In August 2022 Christopher Tshivule was sentenced to 8 yrs in jail for his component inside of a R1.5-million lottery grant fraud. Fees from two people charged with him, who the SIU has called “kingpins” inside the corruption that overcome the NLC, have been dropped.

Major-General Mmeli Makinyane, the acting divisional commissioner for priority offences, explained to MPs which the Hawks had been at the moment investigating 16 lottery corruption-related scenarios. An additional a person - the Kimberley make any difference - is prior to a courtroom and two have been sent to your NPA for a call to prosecute. An extra 5 cases are now being investigated because of the SAPS detective and forensic providers, he claimed.

Describing the reasons for the delay in prosecutions, NPA Deputy National Director Rodney de Kock mentioned Portion of The rationale was the Hawks had to do even more investigations whenever they acquired dossiers in the SIU.

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

Thus, the NPA experienced to work with investigators while in the DPCI (the Hawks) and SAPS to perform criminal investigations and make sure that the proof fulfills prison prosecution expectations, he said, adding: “That said, the perform in the SIU is crucial and contributes greatly to this method.”

De Kock explained that the SIU’s investigation “usually results in various referrals. The referrals may finally end in one particular docket and 1 courtroom case.”

He explained that twelve matters, which happen to be “somewhere around 85% comprehensive”, were being getting jointly investigated via the Hawks and also the SIU’s Specialised Financial Functions Device. (Most of these situations, seven of which have been lodged in 2020, require previous NLC chief running officer Phillemon Letwaba, who resigned less than a cloud in 2022, and Pretoria attorney Leslie Ramulifho.)

De Kock reported the NPA confronted many “troubles” in prosecuting conditions. These, he claimed, involved

the lapse of time between if the offences have been dedicated and the issuing with the Presidential Proclamation on 1 November 2020;
“unavailability of witnesses and/or documentary proof” (Earlier this calendar year, the SIU advised the committee that key documents needed in a few prosecutions had been deleted from the NLC computer technique or experienced long gone lacking from Metrofile, a warehouse where by copies of documents are archived and stored);
The reality that some implicated people today are still employed by NLC; and
A obstacle to the legality from the Presidential Proclamation by former NLC chairperson Alfred Nevhutanda.
“The NPA is committed to ensuring finalisation in these issues. To this stop, a group of dedicated prosecutors continues to be allotted to supervise all NLC matters at present under investigation,” de Kock reported. “Matters are managed as being a precedence. As soon as [the] investigations are done, the NPA is likely to make a choice.”

What the businesses say (or don’t)
GroundUp was only capable of get remark from among the 5 companies accused because of the SIU in Parliament of manufacturing fraudulent once-a-year financial statements,TTP Consulting.

Aubrey Moeng, one among TTP’s two administrators, claimed within an electronic mail in reaction to inquiries: “Because of consumer confidentiality, we desire to advise that TTP Consulting isn't willing to divulge clients’ financial private details with the public or media … with no consent on the client or a authorized reason.”

The corporate is actually a “companion” of a number of condition entities, including SARS as well as CIPC, In line with its Web-site.

Neither of The 2 directors of Dzata Accountants, who're equally mentioned as inactive on the CIPC register of organizations, responded to emailed queries. The business has long been deregistered by the CIPC for failing to post money statements due to the fact 2021.

The only director of Mageba Ntuli Investing and Consulting Assistance, Patrick Zulu, died 3 many years in the past, In accordance with Formal data. The organization was deregistered via the CIPC for failing to submit economic statements considering the fact that 2021.

Matamela Magodi, the sole director of Magodi Consultants, did not reply to queries emailed to him.

GroundUp was not able to obtain any listing for Tafta Consulting and Accounting Providers While using the CIPC. We were also unable to trace any of the business’s directors to ask for comment.

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