Tip-off leads to SIU raid of NLC Kimberley offices

Armed with a “search and seizure” warrant from the Kimberley magistrates court in the Northern Cape, the Special Investigating Unit has conducted a raid at the offices of National Lotteries Commission (NLC).

In a statement released on Thursday, the SIU said the warrant authorised the unit to search and confiscate any evidence relating to the funding of non-profit organisations (NPO).

The NLC has the mandate to fund the NPOs that aim to uplift communities.

“Accompanied by members of the directorate for priority crime prevention [Hawks], the SIU investigators are currently raiding NLC offices to seize evidence that might assist with an ongoing investigation,” said the SIU in a statement.

The raid, explained the SIU, was as a result of a tip-off from “reliable whistleblowers”.

It is alleged that NLC officials procured services of runners to scout for NPOs in the Northern Cape and encourage them to apply for funding. However, they would siphon about 30% of the funds upon approval.

“Immediately after the funding was approved and released to NPOs, it is alleged that the runners, together with NLC officials, would share approximately 30% of the funding.”

Last week, the crime busters revealed how the NLC officials and relatives benefited from lotto millions. The unit found that the NLC leadership allegedly looted about R300-million meant for community upliftment projects across the country.

In a statement released last week, the SIU said: “The investigation has uncovered a web of corruption related to NLC funding and [the] flow of funds to NLC officials, board members, and their family members. The SIU is pursuing all individuals involved in the siphoning of NLC money.”

SIU chief national investigations officer Leonard Lekgetho described how in one instance a former board member allegedly “hijacked” an NPO that had received at least R23-million in funding to build an old-age home in Mpumalanga.

Lekgetho said the project was started and left unfinished because “individuals connected to the NLC” siphoned the funds.

“The investigation has revealed that R5-million of the R23-million received from the bank account [of the NPO] was transferred to one attorney of [a group of companies] belonging to the former board member for the transfer of luxurious immovable property in favour of their client,” Lekgetho said.

He disclosed that the probe into the same former board member found that an NPO transferred about R3.3-million into the bank account of a company linked to a senior NLC official a day after receiving R7.5-million funding for the construction for a rehabilitation centre in Gauteng.

According to Lekgetho, R1-million was subsequently transferred into the board member’s account by the same company. The same approach was implemented for the construction of a rehabilitation centre in Mpumalanga.

“[Furthermore], the SIU investigation has revealed that during the period March to May 2018, the former board member received a total amount of R5.47-million into his personal bond account from various NPOs. The bond was for his primary residence in Gauteng,” he said.

Lekgetho added that an investigation into a second former board member found that they had received, either directly or indirectly, at least R10-million from an NPO that was in part used as a deposit for a R27-million house and a deposit for a luxury vehicle.

In a statement, the commission noted “inconsistencies” in the SIU presentation of its findings into the upliftment projects probe and reiterated that it would not publicly address these “inconsistencies” as the investigation had not been concluded.

“The commission remains committed to applying the principles of openness and transparency in the exercise of its mandate and functions. The NLC respects all processes of institutions of state as welcome checks and balances in the process of regulating lotteries and changing the lives of the disadvantaged South Africans,” said the NLC.

In response to the raid in Kimberley on Thursday, the NLC said in a statement that it will continue to cooperate with the SIU during the probe. The commission also stated that its management is “closely” following the developments and will decided on the course of action once the SIU had provided its final findings.

“The NLC would like to assure stakeholders that its daily operations will not be affected by this process as the organisation continues to fulfill its mandate and ensure that the commission performs its functions efficiently and effectively,” said the NLC.

Also read: SIU reveals how NLC officials, relatives benefitted from Lotto millions

SIU intensifies fight against corruption

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