Leaked report exposes abuse of lottery funds paid to minstrel group

Leaked report exposes abuse of lottery funds paid to minstrel group

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Minstrels carry out in Athlone on 2 January 2017. Archive photo: Ashraf Hendricks

A report by Lawyers Dabishi Nthambeleni into a R27.3-million grant from the Nationwide Lotteries Fee towards the Cape City Minstrel Carnival Affiliation (CTMCA) for any minstrels museum has found no proof that a museum at any time existed.
The investigators found which the CTMCA didn't utilize the R5-million allocated to acquire or produce a museum.
In addition they found that the CTMCA only acquired land truly worth R1.seven-million, not R5-million as allocated.
They found the CTMCA used resources with the Lottery to acquire workshop tools from one among its personal administrators, Richard “Pot” Stemmet.
A leaked forensic report reveals how an incredible number of rand granted towards the Cape Town Minstrel Carnival Affiliation (CTMCA) by the Nationwide Lotteries Fee (NLC) to setup a museum to rejoice town’s rich minstrel historical past went astray. The museum was by no means developed.

The main points of your abuse of countless rands of Lottery funds for any museum that under no circumstances was are disclosed within an investigative report commissioned because of the NLC in 2021.

The museum grant was Element of much more than R64-million in Lottery cash allocated on the CTMCA among 2003 and 2017.

The primary Portion of the investigation, by regulation company Dabishi Nthambeleni, was conducted amongst September 2020 and January 2021 and centered on a R27.3-million grant on the CTMCA in 2014, which integrated funding for that museum. The authorized finances for the museum was in excess of R12.eight-million, with R5-million of that allotted for a creating to house the museum.

Go through the report (PDF, 7MB)

The NLC tasked Dabishi Nthambeleni to research the acquisition of the setting up for the museum and whether the museum “really existed”.

The company was also instructed to investigate

the acquisition with Lottery money of two automobiles – a sixty-seater bus in addition to a 23-seater bus – for R2.four-million; and
different machines “obtained to the manufacturing with the costumes and hats” to the minstrels carnival, for R5.four-million.
At time, convicted legal Richard “Pot” Stemmet was director of the CTMCA. He was appointed a director on the CTMCA in September 1996. He resigned in December 2016 but his spouse Zainonesa and daughter Raziah continued as two of various directors in the organisation. Stemmet was reappointed to be a director in Might 2021.

The investigation followed intensive reporting by GroundUp with regards to the millions of rands of Lottery funding allocated towards the CTMCA (see right here, right here and listed here) and the way in which the funds almost certainly helped finance the ANC’s 2014 election marketing campaign from the Western Cape, led by at time by Marius Fransman.



The developing on the proper was the meant internet site from the minstrels’ museum, in the course of an industrial location in Primrose Park, Cape City. Image: Raymond Joseph

In response into a Parliamentary query, previous NLC Commissioner Thabang Mampane mentioned grants to three CTMCA “initiatives” - such as the museum - between 2012 and 2015. All 3 jobs had been accomplished, she told MPs.

Though the investigators located no evidence that a museum experienced at any time existed.

At the beginning the museum was on account of open up in rented premises in Crete Road, Wetton. A photograph obtained by GroundUp in the intended Wetton museum reveals a espresso store with a few musical instruments and minstrel costumes and collages of images haphazardly hung over the partitions, in addition to a design ship on its plinth inside a corner.

In its report, Dabishi Nthambeleni said it had been “not ready” to verify if a museum experienced at any time operated from these premises.

Stemmet advised the investigators the museum were moved simply because they could now not pay for the lease of R100,000 per month. He reported the CTMCA experienced bought house for R1.7-million in Schaapkraal for that museum, but couldn't get it rezoned, and were marketed for a similar rate. Schaapkraal is in a peri-city space considerably from the town.

Due to this fact, the museum were moved to a whole new area in Primrose Park in February 2021, Stemmet informed the Dabishi Nthambeleni investigators. But following going to the premises, that are within an industrial region, the investigators said they doubted irrespective of whether a correct museum existed there. Shots attached into the report present a mishmash of randomly shown uniforms, musical devices and various minstrel paraphernalia nailed towards the wall, shown on tables and unfold out on the ground, without having rationalization.

“There is a minimum volume of goods within the museum [that] on no account represent the greater than a hundred-calendar year heritage on the Cape Town Carnival, the investigators said, introducing that there was “no signage exterior the premises indicating that they housed a museum and … generally, the museum won't look being open to the general public.”

The CTMCA experienced breached the grant agreement, Dabishi Nthambeleni observed, by shifting The placement of the museum to an alternate site with out notifying the NLC.



The Schaapkraal house, on which no museum was at any time built. Photo: Raymond Joseph

Buses
Stemmet advised the investigators the CTMCA had to move through the rented Crete Street premises as it had run up a R4-million financial debt with the City of Cape City and was worried its machines could well be hooked up.

“Mainly because of the authorized battles as well as the debts, the organisation had to maneuver its home from five Crete Street to avoid the sheriff from attaching the residence in the organisation,” Stemmet told the investigators.

Sedrick Soeker, The present director of the CTMCA, instructed them which the two buses bought with lottery cash were stored in a very magic formula site “concealed in the Sheriff”. Although the investigators reported they had been unable to confirm that any buses had ever been bought.

Stemmet also verified which the buses were concealed to prevent them currently being seized. But if the investigators requested for being taken on the area the place the buses had been stored, he explained to them that “the proprietor of the secret site was not accessible to open the premises for us”.

“The CTMCA couldn't give evidence of payment for two vehicles that it allegedly ordered with grant funds,” the investigators claimed.

Soeker also advised them the Schaapkraal property had been marketed due to financial debt.

“Mr Soeker spelled out that In accordance with his being familiar with, as a result of credit card debt owed to town of Cape City, the CTMCA resolved It will be best to promote their [Schaapkraal] home … and to also to cover the belongings on the CTMCA to stay away from the sheriff from attaching the house.”

JP Smith, Cape Town’s mayco member for protection and protection, has Formerly informed GroundUp which the CTMCA “threw dollars away” on litigation with town.

“Each and every year like clockwork, as we method the top on the year, the CTMCA picks a authorized struggle with the City, about permits or something else. We under no circumstances initiate it. They maintain throwing dollars away on vexatious litigation that they reduce and possess charges awarded in opposition to them. That is completely self-inflicted,” he said.

Soeker instructed the Dabishi Nthambeleni investigators that the principle function gamers on issues of Lottery funding have been Stemmet and previous CTMCA board member Kevin Momberg, “who had been answerable for every one of the admin, funds and operating ตัว หวย the CTMCA.” The investigators mentioned they had been not able to Speak to Momberg.

Hats
In the course of their “investigation in loco” at the Primrose Park premises, the investigators “observed several equipment, some in excellent ailment, some in negative ailment and a few that seemed rusty and intensely aged”. Stemmet informed the investigators that there was also an off-web-site storage facility where “instruments and some machinery” had been held.

“We requested him to just take us to the ability but he was evasive to our request.”

Determined by images and invoices in GroundUp’s possession, some, if not all, in the things appear to be equipment which was illegally removed from the CTMCA’s earlier premises. Stemmet is dealing with rates for this elimination.

In accordance with the last development report submitted to your NLC because of the CTMCA, the machinery was procured from Martin-Conne Milliners, an organization by which Stemmet, his wife and his daughter were being administrators at some time.

The investigators uncovered this “alarming”.

“From the CIPC search of Martin-Conne Milliners along with the invoices submitted, we Notice the following alarming discovering: Mr Stemmet himself is really a director of Martin-Conne Milliners. The registered address of the company is five Crete Road, Wetton, Cape Town, the exact same deal with on which the museum was meant to be crafted and/or transformed,” they documented.

An audit by accountants Kopano Incorporated, hooked up on the investigative report, recorded that the CTMCA was in the entire process of acquiring “equipment, plant and inventory” valued at R8.one-million from Stalph 164 CC, investing as Martin-Conne Milliners. Staph 164 was a close corporation of which Stemmet was among the directors.

In keeping with Dabishi Nthambeleni, the organization has paid out R1.2-million like a deposit, which means R6.nine-million is still owed, though there's no payment day established for when this need to be paid out.

The Kopano audit and the near website link amongst the companies “reveal to us that there's ‘foul Engage in’ involved with the purchase from the machinery of the museum workshop”, the investigators said in the report.

“We discover that it is highly possible that CTMCA utilised the funding in the NLC to ‘refund’ certainly one of its main administrators for your assets at a better overpriced rate than the actual price and worth of the assets and/or machinery.”

Suggestions
Dabishi Nthambeleni concluded that it absolutely was unable to establish how the grant to your CTMCA were invested.

“The truth is, an in depth report on how the funding of your NLC was utilized, can be unachievable as the CTMCA does not have any receipts, or evidence of payments to substantiate the quantities expended on Each individual product it asked for funding for. The interim report and closing report on the CTMCA only attach invoices,” Dabishi Nthambeleni concluded.

The investigators discovered which the NLC experienced not carried out a web site go to before approving the grant. But this wasn't normal practice at enough time and they observed no evidence of carelessness by NLC employees.

At enough time, the NLC’s rules did not involve funded organisations to submit proof of payment with interim stories, they identified. This intended that the CTMCA was capable to get a next tranche of funding without having to supply proof that it had utilised the main tranche for its supposed purpose.

Following the appointment of a brand new board, commissioner and senior executive group, the NLC has tightened up on these along with other concerns.

Dabishi Nthambeleni advised that

the NLC decline any upcoming funding apps through the CTMCA;
the CTMCA and any members who were being associated with the grant be subjected towards the NLC’s “delinquency” system;
the NLC open a felony case of fraud with SAPS or perhaps the Hawks for allegations of fraud; and
the NLC start the entire process of recovering the misappropriated resources.
But, as opposed to act over the report’s recommendations, the NLC – beneath its past administration – selected to suppress it, mainly because it had carried out Together with the former experiences into corruption it experienced commissioned.

GroundUp despatched thoughts to Stemmet and Soeker by using SMS, and questioned for e mail addresses to ship the inquiries by e-mail also. But no response were acquired at the time of publication.



The minstrel “museum” in Crete Highway, Wetton. Picture: Raymond Joseph