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10/11/2020 08:54:29
Picture: OUTA
President gives go ahead for SIU investigation into NLC corruption
The Organisation Undoing Tax Abuse (OUTA) says the recent proclamation by President Cyril Ramaphosa mandating the Special Investigating Unit (SIU) to investigate maladministration and irregular procurement processes within the National Lotteries Commission (NLC), is long overdue. The president intervened only after OUTA and civil action organisations GroundUp and Corruption Watch applied ongoing pressure to the NLC and the Department of Trade and Industry (DTI) to act on alleged corruption involving millions of Rands.
The proclamation came into effect on Friday November 6. The SIU, who is accountable to parliament and the President, has also been tasked to recoup all monies lost through maladministration at the NLC. They will likely institute civil action against beneficiaries of pro-active funding as well as other entities to which the NLC allegedly paid unlawful monies.
OUTA laid criminal charges against the NLC Board as well as its COO, Philemon Letwaba, relating to procurement irregularities over several multimillion pro-active Lottery-funded grants. See full story here
The organisation has been investigating NLC corruption since early 2019, and the complaints were made in terms of the Prevention and Combating of Corrupt Activities Act (PRECCA) and Proceeds of Crime Act (POCA). The organisation also laid a criminal complaint against the Board of the NLC in terms of the Public Finance Management Act (PMFA) for allegedly failing to act against corruption.
According to Brendan Slade, legal project manager at OUTA, the organisation has been informed that subpoenas are being drafted and that investigations are well underway. OUTA also laid a complaint against Letwaba, a chartered accountant, with the South African Institute for Chartered Accountants (SAICA). “We have been informed that Letwaba’s response to our charges was due by Friday 6 November. We will follow up and assist SAICA where possible by making available the findings of our own investigations.”
According to Slade, the appointment of a new chairperson for the NLC Board is currently underway. “However, the DTI is very secretive about this appointment.”
Slade praised the work done by investigative journalists and media outlets such as GroundUp. “Notwithstanding the delays by government and the countless run arounds given by the NLC themselves, the proclamation by the President to mandate the SIU to investigate comes after collective pressure by both civil society and investigative journalists. It has undoubtedly forced government to take a stand for the sake of transparency. In the democratic cauldron that is South Africa, transparency must triumph above political and personal agendas,” says Slade.
The president’s proclamation comes shortly after the announcement of a Hawks task team to investigate Lottery corruption. The proclamation covers offences which took place between 1 January 2014 and 6 November, the date the proclamation was published. However, offences prior to 1 January 2014 is not excluded, and neither is new offences committed after the date of its publication that are “relevant to, connected with, incidental or ancillary to the matters … or involve the same persons, entities or contracts investigated under authority of this Proclamation”.
The proclamation authorises the SIU to investigate serious maladministration in connection with the affairs of the NLC and improper or unlawful conduct by NLC employees or officials. Investigation into the unlawful appropriation or expenditure of public money or property, as well as unlawful, irregular or unapproved “acquisitive acts, transactions, measures or practices having a bearing upon state property” also forms part of the SIU’s mandate, as does intentional or negligent loss of public money or damage to public property. Unlawful or improper conduct by any person, which has caused or may cause serious harm to the interests of the public, as well as offences in terms of PRECCA also forms part of the SIU’s investigations.
Slade says it is important to note that the SIU does not have the power to make arrests – their role is to ensure that public funds lost due to irregularities and maladministration are recouped on behalf of the NLC. The unit can, however, cooperate with the Hawks and the National Prosecuting Authority (NPA) to ensure further investigation and prosecution, and also works closely with the Asset Forfeiture Unit (AFU).
The proclamation came into effect on Friday November 6. The SIU, who is accountable to parliament and the President, has also been tasked to recoup all monies lost through maladministration at the NLC. They will likely institute civil action against beneficiaries of pro-active funding as well as other entities to which the NLC allegedly paid unlawful monies.
OUTA laid criminal charges against the NLC Board as well as its COO, Philemon Letwaba, relating to procurement irregularities over several multimillion pro-active Lottery-funded grants. See full story here
The organisation has been investigating NLC corruption since early 2019, and the complaints were made in terms of the Prevention and Combating of Corrupt Activities Act (PRECCA) and Proceeds of Crime Act (POCA). The organisation also laid a criminal complaint against the Board of the NLC in terms of the Public Finance Management Act (PMFA) for allegedly failing to act against corruption.
According to Brendan Slade, legal project manager at OUTA, the organisation has been informed that subpoenas are being drafted and that investigations are well underway. OUTA also laid a complaint against Letwaba, a chartered accountant, with the South African Institute for Chartered Accountants (SAICA). “We have been informed that Letwaba’s response to our charges was due by Friday 6 November. We will follow up and assist SAICA where possible by making available the findings of our own investigations.”
According to Slade, the appointment of a new chairperson for the NLC Board is currently underway. “However, the DTI is very secretive about this appointment.”
Slade praised the work done by investigative journalists and media outlets such as GroundUp. “Notwithstanding the delays by government and the countless run arounds given by the NLC themselves, the proclamation by the President to mandate the SIU to investigate comes after collective pressure by both civil society and investigative journalists. It has undoubtedly forced government to take a stand for the sake of transparency. In the democratic cauldron that is South Africa, transparency must triumph above political and personal agendas,” says Slade.
The president’s proclamation comes shortly after the announcement of a Hawks task team to investigate Lottery corruption. The proclamation covers offences which took place between 1 January 2014 and 6 November, the date the proclamation was published. However, offences prior to 1 January 2014 is not excluded, and neither is new offences committed after the date of its publication that are “relevant to, connected with, incidental or ancillary to the matters … or involve the same persons, entities or contracts investigated under authority of this Proclamation”.
The proclamation authorises the SIU to investigate serious maladministration in connection with the affairs of the NLC and improper or unlawful conduct by NLC employees or officials. Investigation into the unlawful appropriation or expenditure of public money or property, as well as unlawful, irregular or unapproved “acquisitive acts, transactions, measures or practices having a bearing upon state property” also forms part of the SIU’s mandate, as does intentional or negligent loss of public money or damage to public property. Unlawful or improper conduct by any person, which has caused or may cause serious harm to the interests of the public, as well as offences in terms of PRECCA also forms part of the SIU’s investigations.
Slade says it is important to note that the SIU does not have the power to make arrests – their role is to ensure that public funds lost due to irregularities and maladministration are recouped on behalf of the NLC. The unit can, however, cooperate with the Hawks and the National Prosecuting Authority (NPA) to ensure further investigation and prosecution, and also works closely with the Asset Forfeiture Unit (AFU).