Hammanskraal: The Special Tribunal has declared the R14 million in funding awarded by the National Lotteries Commission (NLC) to the Madumelani Community Project as unlawful, invalid, and set aside. The ruling, which was welcomed by the Special Investigating Unit (SIU), comes after the unit exposed an intricate scheme by brothers Tshimangadzo and Ndoweni Mukutu, who fraudulently obtained funding intended for the construction of a cultural village in Hammanskraal.
According to South African Government News Agency, the cultural village that the two had claimed they would build was already established in 2015 through legitimate R300,000 in NLC funding by the Maubane Cultural Village and Community Arts Centre. In her judgment, President of the Special Tribunal, Judge Margaret Victor, found that the scheme concocted by the two brothers was ‘clearly fraudulent’. She noted that the facts and context are clear, highlighting that South Africa is in the midst of a catastrophic corruption epidemic. The brothers have also been ordered to pay back the funding money.
The SIU revealed that the two brothers weaved a scheme with ‘extensive planning and deliberate misrepresentation, including the unlawful use of the Madumelani Community Project’s constitution’. Cited as one of the respondents in the judgment is Dzata Accountants – a firm identified by the SIU as one of five firms that helped in the looting of NLC coffers. The accounting firm allegedly prepared false financial statements for the grant application.
The SIU investigation found that the original members of the Madumelani Community Project did not apply for NLC funding and were unaware of the grant application process. Instead, Tshimangadzo Mukutu fraudulently submitted the application, falsely claiming to be a director of the organization. The probe revealed that the brothers had approached the project’s members, obtained a copy of its constitution under the pretext of assisting with funding applications, and later used it without authorization.
The false takeover of the legitimate project also included the appointment of fictitious office bearers and the ‘opening of a bank account through which millions of rands were disbursed’. Following the disbursement of funds in February 2018 into a newly opened bank account, substantial payments were channeled to various entities and relatives, including companies associated with T Mukutu.
Between March and July 2018, several transactions were made, including nine transactions with RUM Management Consultancy, owned by Ndoweni Mukutu, totaling some R3,070,000. Ndhava Management Consulting, owned by Tshisimba Collin Mukondoleli, received a payment of R4,999,000, while Thwala Front, owned by Mukondoleli’s wife, Kharivhe Fulufhelo Promise, was paid R1,400,000. At least R1 million of that money was paid to a money trading account. Additionally, R50,000 was paid in salaries, and R400,000 was recorded as a hardware purchase.
The SIU found that the Mukutu brothers, along with Mukondoleli and his wife, and Tshilidzi David Netswinganani, who acted as the treasurer and one of the signatories, had ‘hijacked’ the NPO. In April 2018, five payments totaling R4,650,000 were also made, with R3,519,000 going to Mudonde Events and Investment owned by N Mukutu. These included a payment of R3 million to a trust associated with Advocate William Huma, a former NLC Board member.
The corruption-busting unit welcomed the ruling, stating that the order of the Special Tribunal is part of the implementation of the SIU investigation outcomes and consequence management to recover financial losses suffered by State institutions due to corruption, maladministration, or malpractice. In line with the Special Investigating Units and Special Tribunals Act 74 of 1996, the SIU refers any evidence it uncovers that indicates possible criminal conduct to the National Prosecuting Authority for further action.
