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 complete in Athlone on 2 January 2017. Archive photo: Ashraf Hendricks

A report by attorneys Dabishi Nthambeleni right into a R27.three-million grant through the National Lotteries Fee for the Cape Town Minstrel Carnival Affiliation (CTMCA) for the minstrels museum has found no evidence that a museum at any time existed.
The investigators located the CTMCA did not utilize the R5-million allocated to purchase or produce a museum.
They also observed that the CTMCA only purchased land really worth R1.seven-million, not R5-million as allocated.
They uncovered the CTMCA made use of cash within the Lottery to purchase workshop machines from one of its own administrators, Richard “Pot” Stemmet.
A leaked forensic report reveals how an incredible number of rand granted for the Cape City Minstrel Carnival Association (CTMCA) via the National Lotteries Commission (NLC) to arrange a museum to celebrate the city’s prosperous minstrel background went astray. The museum was hardly ever produced.

The small print of your abuse of countless rands of Lottery funds for just a museum that by no means was are uncovered within an investigative report commissioned via the NLC in 2021.

The museum grant was part of a lot more than R64-million in Lottery cash allotted to your CTMCA involving 2003 and 2017.

The very first A part of the investigation, by legislation firm Dabishi Nthambeleni, was done amongst September 2020 and January 2021 and focused on a R27.three-million grant towards the CTMCA in 2014, which bundled funding to the museum. The accredited finances for your museum was much more than R12.8-million, with R5-million of that allotted for a constructing to deal with the museum.

Study the report (PDF, 7MB)

The NLC tasked Dabishi Nthambeleni to analyze the purchase of the setting up for that museum and if the museum “essentially existed”.

The business was also instructed to research

the purchase with Lottery cash of two automobiles – a 60-seater bus in addition to a 23-seater bus – for R2.four-million; and
various devices “acquired with the production of the costumes and hats” to the minstrels carnival, for R5.four-million.
At the time, convicted legal Richard “Pot” Stemmet was director on the CTMCA. He was appointed a director of your CTMCA in September 1996. He resigned in December 2016 but his wife Zainonesa and daughter Raziah continued as two of a number of administrators of the organisation. Stemmet was reappointed like a director in May possibly 2021.

The investigation adopted substantial reporting by GroundUp concerning the numerous rands of Lottery funding allotted into the CTMCA (see in this article, below and listed here) and just how the cash in all probability helped finance the ANC’s 2014 election campaign while in the Western Cape, led by at time by Marius Fransman.



The building on the ideal was the supposed website of your minstrels’ museum, in the course of an industrial region in Primrose Park, Cape Town. Photograph: Raymond Joseph

In response to a Parliamentary dilemma, previous NLC Commissioner Thabang Mampane stated grants to 3 CTMCA “jobs” - such as the museum - involving 2012 and 2015. All three jobs had been done, she explained to MPs.

But the investigators uncovered no proof that a museum experienced ever existed.

At first the museum was because of open in rented premises in Crete Street, Wetton. A photograph acquired by GroundUp of your supposed Wetton museum displays a coffee shop with some musical instruments and minstrel costumes and collages of photographs haphazardly hung to the partitions, in addition to a product ship on its plinth inside of a corner.

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

Stemmet advised the investigators the museum had been moved since they could no more manage the hire of R100,000 a month. He said the CTMCA had purchased residence for R1.seven-million in Schaapkraal for your museum, but couldn't get it rezoned, and were offered for the same price. Schaapkraal is in the peri-city area significantly from town.

Therefore, the museum were moved to a whole new place in Primrose Park in February 2021, Stemmet advised the Dabishi Nthambeleni investigators. But after going to the premises, that happen to be in an industrial region, the investigators stated they doubted no matter whether a correct museum existed there. Photographs attached towards the report show a mishmash of randomly exhibited uniforms, musical instruments and diverse minstrel paraphernalia nailed to the wall, shown on tables and distribute out on the floor, without rationalization.

“There's a negligible volume of products with the museum [that] on no account symbolize the much more than 100-year historical past of your Cape City Carnival, the investigators reported, adding that there was “no signage outdoors the premises indicating they housed a museum and … commonly, the museum would not look to be open up to the general public.”

The CTMCA had breached the grant agreement, Dabishi Nthambeleni pointed out, by transferring The placement from the museum to another site devoid of notifying the NLC.



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

Buses
Stemmet informed the investigators the CTMCA experienced to move with the rented Crete Road premises since it had operate up a R4-million debt with the City of Cape Town and was fearful its equipment can be connected.

“Due to the legal battles plus the debts, the organisation experienced to maneuver its residence from 5 Crete Road to steer clear of the sheriff from attaching the residence in the organisation,” Stemmet informed the investigators.

Sedrick Soeker, The existing director on the CTMCA, informed them which the two buses bought with lottery cash have been stored inside a top secret site “hidden through the Sheriff”. However the investigators explained they ended up not able to verify that any buses had at any time been bought.

Stemmet also verified that the buses were concealed to stop them staying seized. But when the investigators asked for being taken to the spot in which the buses were stored, he advised them that “the operator of The trick place wasn't accessible to open up the premises for us”.

“The CTMCA could not present evidence of payment for two vehicles that it allegedly purchased with grant income,” the investigators reported.

Soeker also told them the Schaapkraal property had been offered as a result of financial debt.

“Mr Soeker stated that In line with his comprehension, due to financial debt owed to the town of Cape City, the CTMCA determined It could be best to market their [Schaapkraal] assets … and to also to hide the property of your CTMCA to avoid the sheriff from attaching the residence.”

JP Smith, Cape Town’s mayco member for basic safety and security, has Earlier informed GroundUp which the CTMCA “threw funds away” on litigation with the City.

“Annually like clockwork, as we approach the end on the calendar year, the CTMCA picks a legal fight with town, more than permits or something else. We under no circumstances initiate it. They retain throwing cash away on vexatious litigation they reduce and also have expenditures awarded from them. This is often completely self-inflicted,” he mentioned.

Soeker informed the Dabishi Nthambeleni investigators that the primary job players on problems with Lottery funding have been Stemmet and previous CTMCA board member Kevin Momberg, “who were being answerable for all the admin, funds and operating cat888 the CTMCA.” The investigators said they had been not able to Make contact with Momberg.

Hats
In the course of their “investigation in loco” in the Primrose Park premises, the investigators “observed numerous devices, some in superior situation, some in undesirable situation and several that seemed rusty and intensely aged”. Stemmet explained to the investigators that there was also an off-website storage facility the place “instruments and many equipment” were being kept.

“We asked him to choose us to the power but he was evasive to our ask for.”

According to photos and invoices in GroundUp’s possession, some, Otherwise all, on the products look like tools which was illegally faraway from the CTMCA’s earlier premises. Stemmet is facing prices for this removal.

Based on the remaining development report submitted for the NLC by the CTMCA, the machinery was acquired from Martin-Conne Milliners, a company wherein Stemmet, his wife and his daughter have been directors at the time.

The investigators located this “alarming”.

“Within the CIPC research of Martin-Conne Milliners and the invoices submitted, we Notice the following alarming discovering: Mr Stemmet himself is actually a director of Martin-Conne Milliners. The registered address of the corporation is 5 Crete Highway, Wetton, Cape Town, the same deal with on which the museum was meant to be crafted and/or converted,” they documented.

An audit by accountants Kopano Incorporated, attached to your investigative report, recorded that the CTMCA was in the process of obtaining “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 one among the directors.

According to Dabishi Nthambeleni, the company has compensated R1.2-million like a deposit, that means R6.9-million remains to be owed, while there is no payment day set for when this needs to be paid out.

The Kopano audit as well as the shut backlink in between the businesses “show to us that there's ‘foul play’ linked to the purchase on the equipment from the museum workshop”, the investigators claimed from the report.

“We discover that it's extremely probable that CTMCA applied the funding of your NLC to ‘refund’ one among its key administrators for that residence at an increased overpriced level than the particular rate and price of the house and/or machinery.”

Tips
Dabishi Nthambeleni concluded that it had been unable to establish how the grant to the CTMCA were put in.

“In fact, an in depth report on how the funding on the NLC was utilized, might be extremely hard because the CTMCA doesn't have any receipts, or evidence of payments to confirm the amounts invested on Every merchandise it requested funding for. The interim report and remaining report from the CTMCA only attach invoices,” Dabishi Nthambeleni concluded.

The investigators observed which the NLC experienced not conducted a internet site visit just before approving the grant. But this was not normal apply at time and they discovered no evidence of carelessness by NLC employees.

At some time, the NLC’s guidelines did not involve funded organisations to post proof of payment with interim reports, they identified. This meant which the CTMCA was in a position to get a second tranche of funding without having to deliver proof that it had made use of the primary tranche for its supposed goal.

Following the appointment of a completely new board, commissioner and senior executive staff, the NLC has tightened up on these along with other challenges.

Dabishi Nthambeleni suggested that

the NLC decline any potential funding apps with the CTMCA;
the CTMCA and any customers who have been associated with the grant be subjected for the NLC’s “delinquency” procedure;
the NLC open up a felony situation of fraud with SAPS or the Hawks for allegations of fraud; and
the NLC begin the whole process of recovering the misappropriated cash.
But, as an alternative to act within the report’s tips, the NLC – below its former administration – chose to suppress it, since it had performed With all the past reports into corruption it had commissioned.

GroundUp sent thoughts to Stemmet and Soeker by way of SMS, and requested for e-mail addresses to ship the issues by electronic mail as well. But no response were been given at some time of publication.



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