Hawks and SIU raid accountants in lottery corruption probe

A raid by the Hawks and the Special Investigating Unit (SIU) on a Kimberley accounting firm was part of the investigation that began with a raid on the National Lotteries Commission’s (NLC) office in the city nearly two years ago.

The raid on the unnamed accountants came after a Kimberley magistrate granted the SIU a search and seizure warrant. Laptops and “relevant” documents were seized.

This came after a tip-off from a whistle-blower claiming that “certain accounting firms and accountants were allegedly engaged in criminal activities by aiding nonprofit organisations (NPO) and nonprofit companies (NPC) in preparing and producing fraudulent financial statements which are meant to be submitted to the NLC in support of their application for grant funding”, said SIU spokesperson Kaizer Kganyago.

One of the requirements for NLC grant funding in terms of the Lotteries Act is that an applicant must submit an audited financial statement together with an application form, said Kganyago.

The whistle-blower alleged that several NPOs and NPCs submitted fraudulent financial statements to the NLC, which were prepared, produced and signed off by the directors and or representatives of the accountants without any bank statements submitted to the accountants, he said.

Computers, hard drives, and documentation relating to grants issued from  2014 to 2020 were seized in a March 2022 raid on the NLC’s offices and the private home of the two senior employees, GroundUp reported at the time.

Seven NLC Northern Cape employees were named in the search and seizure warrant issued by a Kimberley court in 2022, including Aobakwe Gaobuse, the deputy provincial head, and her partner, Edmond Macatees. The SIU and Hawks found many official NLC documents at the suburban home of Gaobuse and Macatees.

Wednesday’s raid is linked to the raid on the NLC’s offices two years ago, said Kganyago.

GroundUp reported on several occasions that forged documents were used in multimillion-rand grant applications.

Audit firm SkX Protiviti, which was appointed by the NLC to investigate lottery corruption, reported that they discovered how fraudulent finances were used to apply for grants.

“In some cases, the only financial records that were found were those provided by the beneficiaries during the application stage, and we noted that in some instances, the financial position presented by the beneficiaries appears to have been misrepresented and/or fraudulent,” SkX reported.

The NLC Kimberley office also featured last week in a report to parliament on the SIU’s progress in its investigation into grant fraud.

SIU head Andy Mothibi told MPs how an NPO, Thusong Development, which had received a grant of R2.6-million for “online acting classes”, transferred R50,000 to Gogontle Matseke, who was employed by the NLC in its Kimberley office.

Matseke was charged with misconduct but resigned before facing a disciplinary inquiry. The SIU intended to sue to recover the money and had referred the matter to the police for criminal investigation, said Mothibi.

GroundUP/