Only a fraction of the R11 million grant appears to have gone to its intended purpose
The National Lotteries Commission has given more than R11 million to non-profit organisation (NPO) called I Am Made for God's Glory, which has in turn paid R2 million to a private company of which the sole director is the cousin of the chief operating officer of the National Lotteries Commission.
According to leaked bank statements, R2 million was paid to Upbrand Properties by I Am Made For God's Glory (IAM4GG), which received a R11,375,000 grant from the Lottery to develop an "integrated sports facility" in Limpopo.
The sole director of Upbrand is Kenneth Tomoletso Sithole, first cousin of NLC chief operating officer Phillemon Letwaba.
GroundUp has previously revealed how Upbrand received a R15-million contract to build a rehabilitation centre near Pretoria at a time when Letwaba's brother, Johannes "Joe" Letwaba, was a director of the company. Johannes Letwaba subsequently resigned, leaving Keneilwe Constance Maboa, the wife of Karabo Sithole, another first cousin of the Letwaba brothers, as the company's sole director. When Maboa resigned 17 months later, Kenneth Sithole was appointed as Upbrand's sole director.
What the bank statements show
The bank statements are for an IAM4GG account opened at Nedbank on 10 January 2017. The account lay dormant for over a year until an amount of R380 was transferred into it to reactivate it on 16 February 2018.
Once again there was no activity on the account and by 25 April 2018 bank charges had reduced the available credit to just R190.55.
The next day the NLC paid R9.1-million into the account, the first of two tranches of the IAM4GG grant. The second tranche of R2,275,000 was paid into the account on 6 July 2018.
The application for funding submitted to the NLC listed lawyer Lesley Ramulifho as IAM4GG's chairperson and Karabo Sithole as secretary.
In other words, money passed from the National Lotteries Commission, of which Letwaba is COO, through IAM4GG, of which Letwaba's cousin Karabo Sithole is secretary, to Upbrand, of which Kenneth Sithole, cousin of both Karabo Sithole and of Letwaba, is sole director. And the chairman of IAM4GG is Ramulifho, who has already received at least R60 million in Lottery funds, as GroundUp has previously revealed.
Moreover, Phillemon Letwaba signed the grant agreement for the NLC on 16 April 201 8.
Where are the promised deliverables?
In its application for funding, IAM4GG said the plan was "to provide infrastructure in order to advance sport, recreation and physical activity in communities across the country". The project was aimed at sports "transformation" and athletes from "disadvantaged ... especially our rural communities". It would create 60 full-time and 40 part-time jobs and benefit over 16,000 people, according to the application.
GroundUp has not been able to establish where this "infrastructure" is located because the NLC failed to answer our questions. But the commission told GroundUp in a November 2018 statement that the "project work is complete" and the project had been handed over to the local municipality.
The grant allocated R10,440,000 for "capacity building (integrated sports facility)"; R500,000 for "sports equipment and apparel" and R435,000 for administration.
But only five payments in the leaked IAM4GG bank statements appear to be directly connected to the sports facility: R500,000 on 7 May 2018, for "construction sports stadium" and a further four payments for "sports centre" that totalled R22,500. The payments were made on 17, 19 and 20 July 2018. If there were any further payments related to the sports facility, they are not recorded as such on the bank statements.
There were two mystery payments from the IAM4GG account for R5 million on 4 May 2018, and a further R700,000 on 7 July, paid into an account identified only by a number. An amount of R3 million was paid into the same account on 26 January 2018 by Denzhe, an NPO controlled by Ramulifho. This number refers to a Nedbank "investment account", according to a source at the bank.
However there are other deductions for management fees (R50,000 on 30 April 2018 and R25,000 on 7 May), and deductions to Hush Interiors, an upmarket decor company (R40,000 on 3 May 2018), Bradlows (R19,599.95 on 8 May 2018) and Vaja Products (saunas and steam rooms - R132,000 on 8 May 2018). Within days of the first R9.1 million tranche of the Lottery grant landing in IAM4GG's account, the first of a series of payments totalling R644,000 were made for "legal drafting".The payments, ranging from R10,000 to R200,000, were made between 30 April and 30 May 2018.
And, after the second tranche of R2,275,000 was paid on 6 July 2018, a further R373,900 was paid out for "legal drafting" over the next two weeks.
The bank statements also list payments totalling R672,000 that are described as "franchise fee" from the NPO's bank account.
By 30 June 2018, the Lottery funding was almost exhausted with only R1,708.79 left in the account. But six days later, on 6 July, the account was topped up again with a deposit of R2,275,000 -- the second tranche -- by the NLC.
However, after a series of payments -- including R373,900 for "legal drafting", R700,000 into the mystery account, R100,000 for "management fees" and R50,000 to a courier company -- the account balance was reduced to just R81,706.99 by 14 July, a week after the NLC payment.
Neither Ramulifho nor his employee Liesl Moses responded to emailed questions about the project and the information contained in the bank statements.
GroundUp also contacted two people listed as directors of IAM4GG when the organisation was registered with the Department of Social Development in 2012: Thomas Nkuna, deputy chairperson, and Mpho Maphanga, treasurer. Neither responded.
The NLC failed to respond to detailed questions sent to Commissioner Thabang Mampane and spokesman Ndivuhuho Mafela.
Instead the NLC's head of legal affairs, Tsietsi Maselwa, responded by email, noting the "serious allegations", and claiming to be unaware of most of the information on which we based our questions.
Phillemon Letwaba is suing Raymond Joseph, its editor Nathan Geffen, and Community Media Trust, the owner of GroundUp, for defamation.
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