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 attorneys Dabishi Nthambeleni into a R27.3-million grant with the Countrywide Lotteries Fee to your Cape City Minstrel Carnival Association (CTMCA) to get a minstrels museum has found no proof that a museum at any time existed.
The investigators discovered the CTMCA did not utilize the R5-million allotted to obtain or create a museum.
They also found that the CTMCA only purchased land well worth R1.7-million, not R5-million as allotted.
They observed the CTMCA employed resources through the Lottery to purchase workshop devices from certainly one of its very own administrators, Richard “Pot” Stemmet.
A leaked forensic report reveals how numerous rand granted for the Cape Town Minstrel Carnival Association (CTMCA) by the Nationwide Lotteries Fee (NLC) to build a museum to celebrate the town’s wealthy minstrel history went astray. The museum was never developed.
The small print of the abuse of numerous rands of Lottery funds for a museum that never was are revealed in an investigative report commissioned because of the NLC in 2021.
The museum grant was part of a lot more than R64-million in Lottery money allocated on the CTMCA amongst 2003 and 2017.
The initial A part of the investigation, by law agency Dabishi Nthambeleni, was carried out in between September 2020 and January 2021 and centered on a R27.three-million grant to your CTMCA in 2014, which integrated funding with the museum. The approved spending budget with the museum was more than R12.8-million, with R5-million of that allocated for just a making to deal with the museum.
Read the report (PDF, 7MB)
The NLC tasked Dabishi Nthambeleni to investigate the purchase of a creating to the museum and if the museum “basically existed”.
The business was also instructed to research
the purchase with Lottery funds of two automobiles – a sixty-seater bus in addition to a 23-seater bus – for R2.four-million; and
different equipment “ordered to the manufacturing of your costumes and hats” to the minstrels carnival, for R5.four-million.
At time, convicted prison Richard “Pot” Stemmet was director in 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 ongoing as two of quite a few directors in the organisation. Stemmet was reappointed to be a director in May possibly 2021.
The investigation followed substantial reporting by GroundUp regarding the an incredible number of rands of Lottery funding allocated to your CTMCA (see right here, listed here and below) and how the resources probably aided finance the ANC’s 2014 election campaign within the Western Cape, led by at some time by Marius Fransman.
The making on the best was the supposed web page with the minstrels’ museum, in the middle of an industrial location in Primrose Park, Cape City. Photograph: Raymond Joseph
In reaction to some Parliamentary query, previous NLC Commissioner Thabang Mampane detailed grants to 3 CTMCA “tasks” - including the museum - concerning 2012 and 2015. All three initiatives were completed, she instructed MPs.
But the investigators uncovered no proof that a museum experienced ever existed.
At first the museum was as a consequence of open in rented premises in Crete Street, Wetton. A photo attained by GroundUp with the meant Wetton museum exhibits a espresso shop with some musical instruments and minstrel costumes and collages of photographs haphazardly hung about the walls, in addition to a model ship on its plinth in a very corner.
In its report, Dabishi Nthambeleni mentioned it was “not ready” to verify if a museum had ever operated from these premises.
Stemmet advised the investigators the museum were moved mainly because they could no more afford the hire of R100,000 a month. He claimed the CTMCA experienced ordered assets for R1.seven-million in Schaapkraal with the museum, but couldn't get it rezoned, and were offered for the same value. Schaapkraal is in a very peri-urban area significantly from the city.
Subsequently, the museum had been moved to a brand new location in Primrose Park in February 2021, Stemmet instructed the Dabishi Nthambeleni investigators. But just after browsing the premises, which are in an industrial spot, the investigators said they doubted no matter whether an appropriate museum existed there. Pictures attached to the report show a mishmash of randomly exhibited uniforms, musical instruments and diverse minstrel paraphernalia nailed towards the wall, shown on tables and spread out on the floor, without having explanation.
“You will find there's nominal amount of objects within the museum [that] by no means depict the much more than a hundred-calendar year historical past of your Cape Town Carnival, the investigators mentioned, adding that there was “no signage outside the premises indicating which they housed a museum and … frequently, the museum would not glimpse being open up to the general public.”
The CTMCA had breached the grant agreement, Dabishi Nthambeleni observed, by shifting the location of the museum to an alternate place without notifying the NLC.
The Schaapkraal residence, on which no museum was ever designed. Photo: Raymond Joseph
Buses
Stemmet explained to the investigators that the CTMCA had to move within the rented Crete Road premises as it experienced run up a R4-million financial debt with the City of Cape Town and was frightened its devices would be attached.
“Because of the legal battles plus the debts, the organisation experienced to maneuver its home from 5 Crete Road to avoid the sheriff from attaching the residence of your organisation,” Stemmet told the investigators.
Sedrick Soeker, The existing director of your CTMCA, explained to them the two buses bought with lottery resources ended up stored inside a top secret spot “concealed from your Sheriff”. However the investigators claimed they had been unable to substantiate that any buses experienced ever been purchased.
Stemmet also confirmed which the buses had been hidden to stop them currently being seized. But in the event the investigators questioned to become taken to your place in which the buses have been stored, he instructed them that “the proprietor of The key area was not available to open up the premises for us”.
“The CTMCA couldn't provide proof of payment for two automobiles that it allegedly obtained with grant income,” the investigators claimed.
Soeker also explained to them the Schaapkraal residence had been bought as a result of credit card debt.
“Mr Soeker spelled out that In accordance with his knowing, as a result of financial debt owed to the City of Cape Town, the CTMCA made the decision It could be finest to provide their [Schaapkraal] assets … and also to also to hide the property in the CTMCA to avoid the sheriff from attaching the house.”
JP Smith, Cape City’s mayco member for protection and safety, has Formerly informed GroundUp that the CTMCA “threw funds away” on litigation with the City.
“Annually like clockwork, as we approach the top of your calendar year, the CTMCA picks a legal struggle with town, around permits or another thing. We never initiate it. They keep throwing funds absent on vexatious litigation they get rid of and have prices awarded in opposition to them. This really is fully self-inflicted,” he mentioned.
Soeker instructed 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 being answerable for every one of the admin, funds and working ruay the CTMCA.” The investigators reported they were struggling to Get hold of Momberg.
Hats
Throughout their “investigation in loco” for the Primrose Park premises, the investigators “discovered quite a few devices, some in superior situation, some in undesirable ailment and some that appeared rusty and intensely old”. Stemmet informed the investigators that there was also an off-internet site storage facility where by “devices and many machinery” were being kept.
“We questioned him to consider us to the facility but he was evasive to our ask for.”
Dependant on shots and invoices in GroundUp’s possession, some, Otherwise all, in the products seem like equipment which was illegally removed from the CTMCA’s preceding premises. Stemmet is dealing with rates for this elimination.
In accordance with the last progress report submitted to your NLC by the CTMCA, the machinery was acquired from Martin-Conne Milliners, a company where Stemmet, his spouse and his daughter were being administrators at enough time.
The investigators observed this “alarming”.
“With the CIPC research of Martin-Conne Milliners and the invoices submitted, we Take note the next alarming discovering: Mr Stemmet himself is actually a director of Martin-Conne Milliners. The registered deal with of the corporate is 5 Crete Highway, Wetton, Cape Town, a similar tackle on which the museum was meant to be developed and/or transformed,” they reported.
An audit by accountants Kopano Integrated, hooked up for the investigative report, recorded which the CTMCA was in the whole process of buying “machinery, plant and stock” valued at R8.1-million from Stalph 164 CC, buying and selling as Martin-Conne Milliners. Staph 164 was a close corporation of which Stemmet was certainly one of the directors.
In line with Dabishi Nthambeleni, the corporate has paid out R1.2-million like a deposit, that means R6.9-million is still owed, nevertheless there isn't any payment day set for when this must be paid out.
The Kopano audit as well as the shut hyperlink concerning the companies “suggest to us that there is ‘foul Engage in’ involved in the purchase with the equipment with the museum workshop”, the investigators mentioned during the report.
“We find that it's extremely possible that CTMCA used the funding on the NLC to ‘refund’ among its key administrators for the property at a greater overpriced price than the actual cost and value of the home and/or machinery.”
Recommendations
Dabishi Nthambeleni concluded that it absolutely was not able to ascertain how the grant to the CTMCA were invested.
“In fact, an in depth report on how the funding in the NLC was used, would be extremely hard because the CTMCA doesn't have any receipts, or proof of payments to verify the quantities spent on Each individual item it requested funding for. The interim report and closing report of the CTMCA only attach invoices,” Dabishi Nthambeleni concluded.
The investigators located which the NLC experienced not performed a web page pay a visit to ahead of approving the grant. But this was not typical observe at some time they usually found no proof of carelessness by NLC staff members.
At time, the NLC’s principles did not have to have funded organisations to post proof of payment with interim experiences, they pointed out. This intended the CTMCA was capable of get a 2nd tranche of funding without having to present proof that it experienced used the 1st tranche for its intended goal.
Following the appointment of a whole new board, commissioner and senior govt team, the NLC has tightened up on these and also other challenges.
Dabishi Nthambeleni recommended that
the NLC decline any long term funding programs with the CTMCA;
the CTMCA and any customers who ended up involved with the grant be subjected to your NLC’s “delinquency” process;
the NLC open up a felony scenario of fraud with SAPS or perhaps the Hawks for allegations of fraud; and
the NLC start off the entire process of recovering the misappropriated funds.
But, rather than act over the report’s recommendations, the NLC – less than its earlier administration – selected to suppress it, as it had done While using the prior experiences into corruption it experienced commissioned.
GroundUp despatched concerns to Stemmet and Soeker by means of SMS, and questioned for electronic mail addresses to send the concerns by e-mail also. But no response had been acquired at time of publication.
The minstrel “museum” in Crete Road, Wetton. Photo: Raymond Joseph