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 2 January 2017. Archive photo: Ashraf Hendricks

A report by attorneys Dabishi Nthambeleni right into a R27.three-million grant through 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 utilize the R5-million allocated to get or develop a museum.
They also found which the CTMCA only purchased land really worth R1.seven-million, not R5-million as allocated.
They uncovered the CTMCA applied money within the Lottery to get workshop gear from amongst its possess administrators, Richard “Pot” Stemmet.
A leaked forensic report reveals how an incredible number of rand granted to the Cape Town Minstrel Carnival Association (CTMCA) because of the Countrywide Lotteries Commission (NLC) to create a museum to celebrate the town’s abundant minstrel record went astray. The museum was in no way designed.

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

The museum grant was A part of greater than R64-million in Lottery resources allocated to the CTMCA involving 2003 and 2017.

The initial part of the investigation, by legislation firm Dabishi Nthambeleni, was carried out between September 2020 and January 2021 and focused on a R27.3-million grant to your CTMCA in 2014, which integrated funding to the museum. The authorised spending budget to the museum was much more than R12.eight-million, with R5-million of that allotted for just a building to house the museum.

Read the report (PDF, 7MB)

The NLC tasked Dabishi Nthambeleni to investigate the acquisition of the constructing for your museum and whether the museum “actually existed”.

The business was also instructed to research

the purchase with Lottery cash of two automobiles – a sixty-seater bus as well as a 23-seater bus – for R2.four-million; and
different equipment “obtained with the manufacturing with the costumes and hats” for the minstrels carnival, for R5.4-million.
At some time, convicted criminal 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 spouse Zainonesa and daughter Raziah continued as two of numerous directors in the organisation. Stemmet was reappointed for a director in May perhaps 2021.

The investigation adopted considerable reporting by GroundUp in regards to the an incredible number of rands of Lottery funding allocated towards the CTMCA (see right here, right here and here) and just how the money almost certainly helped finance the ANC’s 2014 election marketing campaign within the Western Cape, led by at some time by Marius Fransman.



The constructing on the proper was the meant website with the minstrels’ museum, in the middle of an industrial spot in Primrose Park, Cape City. Photo: Raymond Joseph

In response to your Parliamentary question, former NLC Commissioner Thabang Mampane shown grants to a few CTMCA “jobs” - such as the museum - in between 2012 and 2015. All three tasks had been accomplished, she instructed MPs.

Though the investigators found no evidence that a museum experienced ever existed.

At the outset the museum was resulting from open in rented premises in Crete Road, Wetton. A photograph received by GroundUp on the supposed Wetton museum reveals a espresso shop with some musical instruments and minstrel costumes and collages of pics haphazardly hung within the walls, and a product ship on its plinth in the corner.

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

Stemmet told the investigators the museum were moved simply because they could not find the money for the rent of R100,000 per month. He explained the CTMCA had ordered property for R1.7-million in Schaapkraal with the museum, but could not get it rezoned, and were marketed for a similar price tag. Schaapkraal is inside a peri-urban place far from the city.

As a result, the museum had been moved to a different locale in Primrose Park in February 2021, Stemmet told the Dabishi Nthambeleni investigators. But following checking out the premises, which are within an industrial place, the investigators claimed they doubted whether an appropriate museum existed there. Pics attached into the report exhibit a mishmash of randomly shown uniforms, musical devices and assorted minstrel paraphernalia nailed on the wall, shown on tables and distribute out on the floor, without any rationalization.

“There exists a minimal degree of things for the museum [that] in no way characterize the more than 100-yr heritage of your Cape City Carnival, the investigators claimed, introducing that there was “no signage outside the house the premises indicating which they housed a museum and … generally, the museum does not appear to become open to the general public.”

The CTMCA had breached the grant agreement, Dabishi Nthambeleni mentioned, by moving The situation in the museum to another locale without the need of notifying the NLC.



The Schaapkraal residence, on which no museum was ever designed. Photograph: Raymond Joseph

Buses
Stemmet told the investigators the CTMCA experienced to move with the rented Crete Highway premises since it experienced operate up a R4-million debt with the City of Cape Town and was concerned its machines could be attached.

“Due to lawful battles and the debts, the organisation had to maneuver its assets from five Crete Highway to steer clear of the sheriff from attaching the residence on the organisation,” Stemmet instructed the investigators.

Sedrick Soeker, The present director from the CTMCA, explained to them the two buses bought with lottery funds were saved inside a top secret site “concealed with the Sheriff”. Although the investigators stated they were being unable to verify that any buses experienced at any time been acquired.

Stemmet also confirmed that the buses had been hidden to prevent them being seized. But if the investigators asked to be taken into the area exactly where the buses ended up stored, he instructed them that “the proprietor of The trick spot wasn't available to open the premises for us”.

“The CTMCA couldn't offer evidence of payment for two autos that it allegedly procured with grant cash,” the investigators described.

Soeker also told them the Schaapkraal home had been offered as a result of personal debt.

“Mr Soeker explained that In line with his knowledge, mainly because of the personal debt owed to town of Cape Town, the CTMCA determined It might be very best to provide their [Schaapkraal] assets … and also to also to cover the property in the CTMCA to avoid the sheriff from attaching the residence.”

JP Smith, Cape Town’s mayco member for protection and safety, has previously instructed GroundUp that the CTMCA “threw income absent” on litigation with the City.

“On a yearly basis like clockwork, as we technique the top from the 12 months, the CTMCA picks a legal fight with the City, in excess of permits or another thing. We by no means initiate it. They hold throwing cash away on vexatious litigation they get rid of and possess expenditures awarded against them. This can be completely self-inflicted,” he explained.

Soeker advised the Dabishi Nthambeleni investigators that the principle part players on problems with Lottery funding have been Stemmet and previous CTMCA board member Kevin Momberg, “who ended up in command of the many admin, finances and functioning ตัว หวย the CTMCA.” The investigators claimed 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 “found a lot of machines, some in superior problem, some in bad issue and some that looked rusty and very aged”. Stemmet told the investigators that there was also an off-internet site storage facility where by “instruments and a few machinery” have been retained.

“We questioned him to choose us to the power but he was evasive to our request.”

Depending on photographs and invoices in GroundUp’s possession, some, if not all, in the things appear to be tools that was illegally faraway from the CTMCA’s former premises. Stemmet is struggling with rates for this removing.

Based on the last development report submitted to your NLC with the CTMCA, the machinery was ordered from Martin-Conne Milliners, a business in which Stemmet, his wife and his daughter were being directors at time.

The investigators uncovered this “alarming”.

“From your CIPC research of Martin-Conne Milliners and the invoices submitted, we Notice the next alarming getting: Mr Stemmet himself is really a director of Martin-Conne Milliners. The registered deal with of the corporate is five Crete Highway, Wetton, Cape City, the exact same handle on which the museum was meant to be designed and/or transformed,” they described.

An audit by accountants Kopano Integrated, connected for the investigative report, recorded that the CTMCA was in the entire process of acquiring “machinery, plant and inventory” valued at R8.1-million from Stalph 164 CC, trading as Martin-Conne Milliners. Staph 164 was a detailed corporation of which Stemmet was one of the directors.

Based on Dabishi Nthambeleni, the corporation has paid R1.two-million as a deposit, indicating R6.nine-million continues to be owed, nevertheless there's no payment date established for when this need to be paid out.

The Kopano audit and the close website link between the businesses “indicate to us that there's ‘foul Perform’ associated with the acquisition on the equipment from the museum workshop”, the investigators claimed in the report.

“We find that it is remarkably possible that CTMCA utilized the funding from the NLC to ‘refund’ among its key administrators to the property at a greater overpriced charge than the actual price and price of the residence and/or machinery.”

Recommendations
Dabishi Nthambeleni concluded that it absolutely was not able to ascertain how the grant on the CTMCA had been spent.

“In point of fact, an in depth report on how the funding from the NLC was utilized, could well be not possible given that the CTMCA does not have any receipts, or evidence of payments to substantiate the amounts expended on Just about every product it requested funding for. The interim report and ultimate report of your CTMCA only attach invoices,” Dabishi Nthambeleni concluded.

The investigators observed that the NLC had not performed a internet site stop by before approving the grant. But this was not standard apply at the time they usually uncovered no proof of negligence by NLC staff.

At time, the NLC’s principles did not need funded organisations to submit evidence of payment with interim studies, they pointed out. This meant that the CTMCA was ready to receive a next tranche of funding without needing to supply evidence that it experienced utilised the very first tranche for its meant intent.

Subsequent the appointment of a completely new board, commissioner and senior executive group, the NLC has tightened up on these and other problems.

Dabishi Nthambeleni advisable that

the NLC decrease any foreseeable future funding apps with the CTMCA;
the CTMCA and any users who ended up involved with the grant be subjected to your NLC’s “delinquency” course of action;
the NLC open a criminal circumstance of fraud with SAPS or perhaps the Hawks for allegations of fraud; and
the NLC commence the process of recovering the misappropriated cash.
But, as opposed to act on the report’s suggestions, the NLC – under its past administration – selected to suppress it, because it experienced carried out Along with the prior studies into corruption it experienced commissioned.

GroundUp despatched questions to Stemmet and Soeker through SMS, and requested for e mail addresses to send the concerns by e-mail way too. But no reaction had been obtained at time of publication.



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