Leaked report exposes abuse of lottery income paid out to minstrel group
Leaked report exposes abuse of lottery income paid out to minstrel group
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Minstrels perform in Athlone on two January 2017. Archive Image: Ashraf Hendricks
A report by Lawyers Dabishi Nthambeleni into a R27.three-million grant from the Countrywide Lotteries Commission to the Cape City Minstrel Carnival Association (CTMCA) to get a minstrels museum has observed no proof that a museum ever existed.
The investigators discovered which the CTMCA didn't make use of the R5-million allotted to obtain or create a museum.
They also located the CTMCA only purchased land really worth R1.7-million, not R5-million as allocated.
They found the CTMCA utilized resources within the Lottery to invest in workshop devices from amongst its very own administrators, Richard “Pot” Stemmet.
A leaked forensic report reveals how millions of rand granted into the Cape City Minstrel Carnival Association (CTMCA) through the National Lotteries Commission (NLC) to setup a museum to rejoice the town’s prosperous minstrel historical past went astray. The museum was never ever created.
The details with the abuse of countless rands of Lottery money for the museum that hardly ever was are revealed within an investigative report commissioned from the NLC in 2021.
The museum grant was A part of greater than R64-million in Lottery resources allocated towards the CTMCA among 2003 and 2017.
The 1st Element of the investigation, by legislation firm Dabishi Nthambeleni, was done involving September 2020 and January 2021 and focused on a R27.3-million grant towards the CTMCA in 2014, which integrated funding for your museum. The authorized spending plan for your museum was in excess of R12.eight-million, with R5-million of that allocated for any making to deal with the museum.
Browse the report (PDF, 7MB)
The NLC tasked Dabishi Nthambeleni to analyze the acquisition of the making for that museum and if the museum “truly existed”.
The company was also instructed to analyze
the acquisition with Lottery funds of two vehicles – a sixty-seater bus plus a 23-seater bus – for R2.4-million; and
many devices “obtained for the production from the costumes and hats” for that minstrels carnival, for R5.4-million.
At enough time, convicted criminal Richard “Pot” Stemmet was director on the CTMCA. He was appointed a director of the CTMCA in September 1996. He resigned in December 2016 but his wife Zainonesa and daughter Raziah continued as two of various directors in the organisation. Stemmet was reappointed for a director in Might 2021.
The investigation followed intensive reporting by GroundUp regarding the a lot of rands of Lottery funding allotted to your CTMCA (see in this article, here and here) and just how the resources likely aided finance the ANC’s 2014 election campaign within the Western Cape, led by at some time by Marius Fransman.
The constructing on the correct was the meant internet site of the minstrels’ museum, in the midst of an industrial area in Primrose Park, Cape Town. Image: Raymond Joseph
In response into a Parliamentary dilemma, former NLC Commissioner Thabang Mampane stated grants to 3 CTMCA “assignments” - such as the museum - concerning 2012 and 2015. All three assignments were done, she told MPs.
Nevertheless the investigators located no evidence that a museum had ever existed.
In the beginning the museum was on account of open in rented premises in Crete Road, Wetton. A photograph received by GroundUp on the supposed Wetton museum shows a espresso shop with a few musical instruments and minstrel costumes and collages of pictures haphazardly hung on the partitions, plus a model ship on its plinth inside of a corner.
In its report, Dabishi Nthambeleni claimed it was “not able” to substantiate if a museum had at any time operated from these premises.
Stemmet told the investigators the museum had been moved since they could no more afford the rent of R100,000 a month. He explained the CTMCA experienced purchased home for R1.7-million in Schaapkraal to the museum, but could not get it rezoned, and had been sold for a similar value. Schaapkraal is inside of a peri-city place significantly from the town.
Due to this fact, the museum were moved to a new location in Primrose Park in February 2021, Stemmet explained to the Dabishi Nthambeleni investigators. But following visiting the premises, that are within an industrial spot, the investigators mentioned they doubted no matter whether a correct museum existed there. Shots attached to your report present a mishmash of randomly exhibited uniforms, musical devices and assorted minstrel paraphernalia nailed to your wall, displayed on tables and spread out on the floor, without any clarification.
“You will find there's minimal volume of goods within the museum [that] in no way symbolize the a lot more than one hundred-yr background with the Cape City Carnival, the investigators said, including that there was “no signage outdoors the premises indicating that they housed a museum and … typically, the museum would not look for being open to the public.”
The CTMCA had breached the grant arrangement, Dabishi Nthambeleni famous, by relocating The placement in the museum to an alternative place with out notifying the NLC.
The Schaapkraal assets, on which no museum was ever constructed. Photo: Raymond Joseph
Buses
Stemmet informed the investigators which the CTMCA had to move from the rented Crete Street premises because it experienced run up a R4-million personal debt with the City of Cape Town and was fearful its gear can be hooked up.
“As a result of authorized battles as well as debts, the organisation experienced to move its home from 5 Crete Highway to steer clear of the sheriff from attaching the assets of your organisation,” Stemmet explained to the investigators.
Sedrick Soeker, The present director in the CTMCA, informed them which the two buses purchased with lottery funds were being stored inside a secret site “hidden in the Sheriff”. Though the investigators mentioned they ended up not able to substantiate that any buses had ever been bought.
Stemmet also verified that the buses were concealed to halt them remaining seized. But when the investigators questioned to be taken to the place exactly where the buses were saved, he instructed them that “the owner of the secret locale wasn't available to open up the premises for us”.
“The CTMCA could not offer evidence of payment for two motor vehicles that it allegedly acquired with grant cash,” the investigators claimed.
Soeker also advised them the Schaapkraal property had been marketed due to the credit card debt.
“Mr Soeker defined that according to his comprehension, because of the financial debt owed to the town of Cape City, the CTMCA resolved it would be very best to market their [Schaapkraal] house … and also to also to hide the assets in the CTMCA to avoid the sheriff from attaching the home.”
JP Smith, Cape City’s mayco member for protection and protection, has Formerly informed GroundUp which the CTMCA “threw dollars away” on litigation with town.
“On a yearly basis like clockwork, as we solution the top with the 12 months, the CTMCA picks a lawful battle with town, in excess of permits or another thing. We never ever initiate it. They maintain throwing dollars absent on vexatious litigation that they eliminate and have charges awarded versus them. This can be fully self-inflicted,” he reported.
Soeker told the Dabishi Nthambeleni investigators that the key position players on issues of Lottery funding had been Stemmet and former CTMCA board member Kevin Momberg, “who were in control of each of the admin, finances and running ruay the CTMCA.” The investigators said they were struggling to contact Momberg.
Hats
In the course of their “investigation in loco” on the Primrose Park premises, the investigators “identified many machines, some in superior affliction, some in undesirable problem and some that seemed rusty and extremely outdated”. Stemmet informed the investigators that there was also an off-site storage facility wherever “instruments and several equipment” had been retained.
“We asked him to get us to the power but he was evasive to our ask for.”
According to images and invoices in GroundUp’s possession, some, Otherwise all, of your items appear to be tools that was illegally removed from the CTMCA’s earlier premises. Stemmet is going through fees for this elimination.
Based on the ultimate progress report submitted towards the NLC from the CTMCA, the equipment was ordered from Martin-Conne Milliners, a business during which Stemmet, his wife and his daughter ended up directors at some time.
The investigators observed this “alarming”.
“From your CIPC look for of Martin-Conne Milliners plus the invoices submitted, we Be aware the subsequent alarming discovering: Mr Stemmet himself is usually a director of Martin-Conne Milliners. The registered address of the business is five Crete Highway, Wetton, Cape City, the identical tackle on which the museum was meant to be crafted and/or converted,” they noted.
An audit by accountants Kopano Integrated, attached for the investigative report, recorded that the CTMCA was in the process of buying “machinery, plant and inventory” valued at R8.1-million from Stalph 164 CC, trading as Martin-Conne Milliners. Staph 164 was a close Company of which Stemmet was one among the directors.
Based on Dabishi Nthambeleni, the company has paid out R1.2-million for a deposit, that means R6.nine-million remains to be owed, although there is no payment date established for when this should be paid out.
The Kopano audit and the close url between the companies “reveal to us that there's ‘foul Participate in’ involved in the purchase from the machinery in the museum workshop”, the investigators claimed during the report.
“We discover that it's remarkably possible that CTMCA utilised the funding on the NLC to ‘refund’ considered one of its key directors for the assets at the next overpriced fee than the actual price and worth of the home and/or equipment.”
Recommendations
Dabishi Nthambeleni concluded that it absolutely was unable to ascertain how the grant towards the CTMCA were spent.
“The truth is, a detailed report on how the funding with the NLC was utilized, might be not possible since the CTMCA doesn't have any receipts, or evidence of payments to substantiate the quantities spent on Each and every merchandise it requested funding for. The interim report and ultimate report on the CTMCA only connect invoices,” Dabishi Nthambeleni concluded.
The investigators observed the NLC had not performed a web site check out ahead of approving the grant. But this was not standard observe at enough time and so they found no proof of negligence by NLC staff members.
At time, the NLC’s rules did not require funded organisations to submit evidence of payment with interim reviews, they identified. This intended that the CTMCA was in the position to receive a second tranche of funding while not having to provide proof that it had applied the first tranche for its intended goal.
Pursuing the appointment of a new board, commissioner and senior govt team, the NLC has tightened up on these along with other troubles.
Dabishi Nthambeleni advisable that
the NLC decrease any foreseeable future funding programs in the CTMCA;
the CTMCA and any members who were being involved with the grant be subjected for the NLC’s “delinquency” procedure;
the NLC open up a legal circumstance of fraud with SAPS or even the Hawks for allegations of fraud; and
the NLC begin the entire process of recovering the misappropriated funds.
But, in lieu of act around the report’s suggestions, the NLC – under its earlier administration – selected to suppress it, mainly because it had completed While using the prior studies into corruption it had commissioned.
GroundUp sent inquiries to Stemmet and Soeker by means of SMS, and questioned for e mail addresses to send out the issues by e mail far too. But no reaction had been received at the time of publication.
The minstrel “museum” in Crete Highway, Wetton. Picture: Raymond Joseph