The investigation by the Special Investigating Unit (SIU) into the National Lotteries Commission (NLC) has been expanded to include accounting firms involved in creating false statements to assist non-profit organizations (NPOs) in obtaining funds they are not entitled to.

Collaborating with the Directorate for Priority Crimes Investigation, also known as the Hawks, the SIU conducted a raid on an accounting firm in Kimberley, Northern Cape, on Wednesday, February 21, 2024, to gather evidence.

“The SIU was granted a search and seizure warrant by the Magistrate Court of the Republic of South Africa, District of Kimberley. The raid follows a tip off received from a whistleblower suggesting that certain accounting firms and accountants were allegedly engaged in criminal activities by aiding NPOs and nonprofit companies (NPCs) in preparing and producing fraudulent financial statements that are meant to be submitted to the NLC in support of their application for grant funding,” said SIU spokesperson Kaizer Kganyago.

Kganyago emphasized that in order to qualify for NLC grant funding under the Lotteries Act, applicants must provide an audited financial statement along with a fully completed application form.

“The whistleblower 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,” said Kganyago. “The law enforcement agencies searched and seized laptops and relevant documents to assist with the SIU’s investigation into the affairs of NLC, which is estimated to be approximately R1,4 billion.”

The second phase of the SIU investigation was made before Parliament’s Portfolio Committee on Trade and Industry on Wednesday, February 14, 2024, bringing attention to important discoveries that are significant in South Africa’s ongoing battle against corruption.

The report specifically focuses on individuals of high prominence who have been implicated, as well as the potential financial losses that may have occurred.

Award-winning actress Moitheri “Terry” Pheto played a significant role in one particular case, where the NLC allocated a significant amount of money to a non-profit organization for a chicken farm project. However, there are indications that the funds may have been misappropriated.

Moitheri Pheto: The actress received a R5 million grant for a chicken farm, but funds were transferred to various entities, and the farm was purchased for the benefit of her sister.

Presley Chweneyagae Foundation: The foundation received a R15 million grant for an arts program, but a significant portion was transferred to a company linked to the spouse of a former NLC official, and other suspicious payments were made.

Marikana chicken farm project: R16.5 million grant awarded to NPO hijacked and used to purchase land through a company linked to former NLC board members. The farm was vandalized despite construction completion.

SIU actions: Eight criminal cases referred to the National Prosecution Authority and 11 disciplinary cases submitted to the NLC.