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 two January 2017. Archive Photograph: Ashraf Hendricks

A report by Lawyers Dabishi Nthambeleni into a R27.three-million grant with the Nationwide Lotteries Fee to your Cape City Minstrel Carnival Affiliation (CTMCA) for just a minstrels museum has identified no proof that a museum ever existed.
The investigators discovered that the CTMCA didn't make use of the R5-million allocated to buy or build a museum.
In addition they observed the CTMCA only bought land truly worth R1.7-million, not R5-million as allotted.
They located the CTMCA employed resources through the Lottery to buy workshop machines from one among its own directors, Richard “Pot” Stemmet.
A leaked forensic report reveals how millions of rand granted for the Cape City Minstrel Carnival Affiliation (CTMCA) by the National Lotteries Commission (NLC) to put in place a museum to rejoice the town’s abundant minstrel history went astray. The museum was in no way designed.

The small print on the abuse of a lot of rands of Lottery cash for the museum that under no circumstances was are discovered in an investigative report commissioned by the NLC in 2021.

The museum grant was part of much more than R64-million in Lottery money allotted on the CTMCA among 2003 and 2017.

The first Component of the investigation, by law agency Dabishi Nthambeleni, was conducted amongst September 2020 and January 2021 and centered on a R27.three-million grant towards the CTMCA in 2014, which involved funding for the museum. The accepted finances with the museum was greater than R12.8-million, with R5-million of that allocated for the developing to house the museum.

Examine the report (PDF, 7MB)

The NLC tasked Dabishi Nthambeleni to investigate the purchase of a building to the museum and if the museum “actually existed”.

The firm was also instructed to investigate

the acquisition with Lottery resources of two automobiles – a 60-seater bus as well as a 23-seater bus – for R2.4-million; and
several devices “obtained to the production from the costumes and hats” for that minstrels carnival, for R5.four-million.
At the time, convicted prison Richard “Pot” Stemmet was director on the CTMCA. He was appointed a director from the CTMCA in September 1996. He resigned in December 2016 but his wife Zainonesa and daughter Raziah continued as two of various administrators in the organisation. Stemmet was reappointed being a director in May perhaps 2021.

The investigation followed intensive reporting by GroundUp concerning the countless rands of Lottery funding allocated to your CTMCA (see below, here and listed here) and the way the money probably helped finance the ANC’s 2014 election campaign while in the Western Cape, led by at the time by Marius Fransman.



The making on the proper was the intended web page with the minstrels’ museum, in the middle of an industrial location in Primrose Park, Cape Town. Photograph: Raymond Joseph

In reaction to some Parliamentary issue, previous NLC Commissioner Thabang Mampane mentioned grants to 3 CTMCA “initiatives” - including the museum - involving 2012 and 2015. All three jobs had been completed, she instructed MPs.

Although the investigators observed no evidence that a museum experienced ever existed.

At the outset the museum was resulting from open in rented premises in Crete Highway, Wetton. A photograph obtained by GroundUp in the meant Wetton museum shows a coffee store with some musical devices and minstrel costumes and collages of pictures haphazardly hung about the partitions, and a design ship on its plinth inside of a corner.

In its report, Dabishi Nthambeleni explained it absolutely was “not ready” to substantiate if a museum had ever operated from these premises.

Stemmet informed the investigators the museum had been moved because they could no longer pay for the rent of R100,000 per month. He mentioned the CTMCA experienced acquired house for R1.seven-million in Schaapkraal with the museum, but couldn't get it rezoned, and were sold for the same selling price. Schaapkraal is in a peri-city location much from the city.

Subsequently, the museum were moved to a different site in Primrose Park in February 2021, Stemmet instructed the Dabishi Nthambeleni investigators. But immediately after traveling to the premises, which are within an industrial spot, the investigators claimed they doubted whether or not a proper museum existed there. Photos hooked up to your report present a mishmash of randomly shown uniforms, musical devices and various minstrel paraphernalia nailed towards the wall, displayed on tables and unfold out on the floor, without rationalization.

“You will find there's minimal level of objects for the museum [that] on no account stand for the more than a hundred-12 months historical past in the Cape Town Carnival, the investigators reported, incorporating that there was “no signage outdoors the premises indicating which they housed a museum and … commonly, the museum will not appear to generally be 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 crafted. Photo: Raymond Joseph

Buses
Stemmet informed the investigators that the CTMCA had to move from your rented Crete Road premises since it had operate up a R4-million personal debt with town of Cape City and was concerned its products can be attached.

“As a result of legal battles and the debts, the organisation experienced to move its assets 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 existing director with the CTMCA, explained to them that the two buses bought with lottery funds were being saved within a magic formula site “hidden within the Sheriff”. Although the investigators stated they have been not able to verify that any buses had ever been acquired.

Stemmet also confirmed that the buses had been hidden to stop them remaining seized. But once the investigators questioned being taken for the place in which the buses were stored, he told them that “the proprietor of the secret area wasn't accessible to open up the premises for us”.

“The CTMCA couldn't provide proof of payment for 2 vehicles that it allegedly purchased with grant cash,” the investigators described.

Soeker also instructed them the Schaapkraal assets were marketed as a result of financial debt.

“Mr Soeker explained that As outlined by his understanding, as a result of debt owed to the town of Cape City, the CTMCA made the decision it would be finest to promote their [Schaapkraal] house … and also to also to cover the belongings from the CTMCA to avoid the sheriff from attaching the residence.”

JP Smith, Cape City’s mayco member for safety and protection, has Beforehand advised GroundUp the CTMCA “threw dollars absent” on litigation with the town.

“Each year like clockwork, as we strategy the end of the calendar year, the CTMCA picks a lawful fight with the City, above permits or something else. We hardly ever initiate it. They maintain throwing money absent on vexatious litigation they get rid of and also have expenses awarded against them. This really is entirely self-inflicted,” he claimed.

Soeker explained to the Dabishi Nthambeleni investigators that the principle role players on problems with Lottery funding have been Stemmet and previous CTMCA board member Kevin Momberg, “who were answerable for the many admin, funds and working หวย ออก the CTMCA.” The investigators reported they had been not able to contact Momberg.

Hats
All through their “investigation in loco” with the Primrose Park premises, the investigators “observed many devices, some in very good ailment, some in poor problem and several that looked rusty and extremely aged”. Stemmet instructed the investigators that there was also an off-web-site storage facility where “devices and a few equipment” have been held.

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

Depending on photos and invoices in GroundUp’s possession, some, Otherwise all, in the objects appear to be devices that was illegally faraway from the CTMCA’s former premises. Stemmet is struggling with prices for this removing.

According to the final progress report submitted towards the NLC because of the CTMCA, the equipment was acquired from Martin-Conne Milliners, a corporation by which Stemmet, his spouse and his daughter had been directors at the time.

The investigators identified this “alarming”.

“Through the CIPC research of Martin-Conne Milliners as well as invoices submitted, we note the following alarming finding: Mr Stemmet himself is really a director of Martin-Conne Milliners. The registered address of the corporate is 5 Crete Highway, Wetton, Cape Town, the exact same handle on which the museum was intended to be designed and/or converted,” they claimed.

An audit by accountants Kopano Integrated, hooked up towards the investigative report, recorded the CTMCA was in the process of obtaining “machinery, plant and stock” valued at R8.one-million from Stalph 164 CC, investing as Martin-Conne Milliners. Staph 164 was an in depth Company of which Stemmet was among the directors.

As outlined by Dabishi Nthambeleni, the corporation has paid out R1.two-million as a deposit, which means R6.nine-million is still owed, though there's no payment date established for when this needs to be paid out.

The Kopano audit plus the shut backlink involving the companies “suggest to us that there is ‘foul Engage in’ linked to the purchase with the equipment in the museum workshop”, the investigators reported inside the report.

“We discover that it's highly probable that CTMCA utilised the funding of the NLC to ‘refund’ one among its key administrators for that assets at a higher overpriced price than the actual cost and value of the home and/or machinery.”

Tips
Dabishi Nthambeleni concluded that it absolutely was not able to ascertain how the grant to your CTMCA had been invested.

“In reality, an in depth report on how the funding on the NLC was employed, would be not possible given that the CTMCA does not have any receipts, or proof of payments to substantiate the quantities invested on Each individual merchandise it asked for funding for. The interim report and remaining report in the CTMCA only attach invoices,” Dabishi Nthambeleni concluded.

The investigators uncovered the NLC experienced not conducted a web-site go to in advance of approving the grant. But this wasn't conventional practice at time they usually found no evidence of carelessness by NLC workforce.

At the time, the NLC’s rules didn't call for funded organisations to submit proof of payment with interim reports, they identified. This meant which the CTMCA was able to get a second tranche of funding without the need to present proof that it experienced employed the first tranche for its meant intent.

Pursuing the appointment of a fresh board, commissioner and senior government team, the NLC has tightened up on these as well as other difficulties.

Dabishi Nthambeleni recommended that

the NLC decline any long run funding purposes from the CTMCA;
the CTMCA and any members who were being involved in the grant be subjected for the NLC’s “delinquency” approach;
the NLC open a prison scenario of fraud with SAPS or even the Hawks for allegations of fraud; and
the NLC begin the whole process of recovering the misappropriated money.
But, instead of act on the report’s suggestions, the NLC – under its past administration – selected to suppress it, since it experienced accomplished Using the previous studies into corruption it experienced commissioned.

GroundUp despatched thoughts to Stemmet and Soeker by way of SMS, and requested for e-mail addresses to send out the concerns by email also. But no response had been acquired at enough time of publication.



The minstrel “museum” in Crete Street, Wetton. Photo: Raymond Joseph