Leaked report exposes abuse of lottery revenue compensated to minstrel team

Leaked report exposes abuse of lottery revenue compensated to minstrel team

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Minstrels perform in Athlone on two January 2017. Archive Photograph: Ashraf Hendricks

A report by Lawyers Dabishi Nthambeleni into a R27.three-million grant via the Nationwide Lotteries Commission into the Cape Town Minstrel Carnival Association (CTMCA) to get a minstrels museum has located no proof that a museum at any time existed.
The investigators discovered the CTMCA didn't use the R5-million allocated to obtain or make a museum.
They also uncovered which the CTMCA only purchased land worthy of R1.7-million, not R5-million as allocated.
They located the CTMCA utilised resources in the Lottery to invest in workshop gear from one among its own directors, Richard “Pot” Stemmet.
A leaked forensic report reveals how many rand granted into the Cape City Minstrel Carnival Association (CTMCA) through the Countrywide Lotteries Fee (NLC) to build a museum to celebrate the town’s rich minstrel heritage went astray. The museum was never ever created.

The small print from the abuse of millions of rands of Lottery cash for the museum that hardly ever was are disclosed in an investigative report commissioned via the NLC in 2021.

The museum grant was Section of much more than R64-million in Lottery resources allocated for the CTMCA in between 2003 and 2017.

The primary Section of the investigation, by law organization Dabishi Nthambeleni, was carried out between September 2020 and January 2021 and centered on a R27.three-million grant on the CTMCA in 2014, which incorporated funding with the museum. The accepted spending plan for your museum was in excess of R12.8-million, with R5-million of that allocated for the constructing to deal with the museum.

Examine the report (PDF, 7MB)

The NLC tasked Dabishi Nthambeleni to analyze the acquisition of a creating to the museum and whether the museum “truly existed”.

The firm was also instructed to research

the purchase with Lottery funds of two cars – a sixty-seater bus as well as a 23-seater bus – for R2.four-million; and
many machines “ordered for your production from the costumes and hats” for that minstrels carnival, for R5.4-million.
At time, convicted felony Richard “Pot” Stemmet was director from the CTMCA. He was appointed a director with the CTMCA in September 1996. He resigned in December 2016 but his wife Zainonesa and daughter Raziah continued as two of quite a few administrators on the organisation. Stemmet was reappointed as being a director in May well 2021.

The investigation followed extensive reporting by GroundUp regarding the many rands of Lottery funding allocated on the CTMCA (see listed here, listed here and here) and the way the resources most likely served finance the ANC’s 2014 election marketing campaign from the Western Cape, led by at the time by Marius Fransman.



The developing on the correct was the meant site of your minstrels’ museum, in the midst of an industrial area in Primrose Park, Cape Town. Photo: Raymond Joseph

In reaction to a Parliamentary query, former NLC Commissioner Thabang Mampane mentioned grants to 3 CTMCA “initiatives” - including the museum - in between 2012 and 2015. All 3 jobs were finished, she advised MPs.

Though the investigators found no evidence that a museum had at any time existed.

Initially the museum was due to open in rented premises in Crete Street, Wetton. A photograph attained by GroundUp with the supposed Wetton museum exhibits a coffee shop with a few musical devices and minstrel costumes and collages of pics haphazardly hung on the partitions, plus a product ship on its plinth inside a corner.

In its report, Dabishi Nthambeleni explained it had been “not in a position” to substantiate if a museum had ever operated from these premises.

Stemmet told the investigators the museum were moved given that they could no longer afford the rent of R100,000 a month. He reported the CTMCA experienced obtained house for R1.seven-million in Schaapkraal to the museum, but couldn't get it rezoned, and had been 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 new spot in Primrose Park in February 2021, Stemmet instructed the Dabishi Nthambeleni investigators. But following browsing the premises, which are within an industrial area, the investigators explained they doubted regardless of whether a suitable museum existed there. Pics connected for the report demonstrate a mishmash of randomly displayed uniforms, musical devices and diverse minstrel paraphernalia nailed for the wall, exhibited on tables and unfold out on the floor, without having clarification.

“You will find there's minimal level of products within the museum [that] by no means represent the over a hundred-year historical past of your Cape City Carnival, the investigators said, adding that there was “no signage outside the premises indicating which they housed a museum and … usually, the museum doesn't search to become open up to the general public.”

The CTMCA had breached the grant arrangement, Dabishi Nthambeleni mentioned, by moving The situation of your museum to an alternate location with out notifying the NLC.



The Schaapkraal assets, on which no museum was at any time designed. Photograph: Raymond Joseph

Buses
Stemmet instructed the investigators which the CTMCA experienced to move from your rented Crete Highway premises because it had run up a R4-million credit card debt with town of Cape Town and was scared its machines could be connected.

“Due to the legal battles along with the debts, the organisation experienced to move its home from 5 Crete Highway to avoid the sheriff from attaching the home in the organisation,” Stemmet advised the investigators.

Sedrick Soeker, The present director on the CTMCA, instructed them the two buses bought with lottery cash ended up stored in a very mystery area “concealed from your Sheriff”. Nevertheless the investigators said they were being not able to confirm that any buses had at any time been acquired.

Stemmet also verified which the buses had been concealed to stop them being seized. But once the investigators asked to get taken to the area where the buses had been saved, he explained to them that “the owner of the secret spot was not available to open the premises for us”.

“The CTMCA could not give evidence of payment for two autos that it allegedly acquired with grant income,” the investigators described.

Soeker also informed them the Schaapkraal property were sold as a result of credit card debt.

“Mr Soeker discussed that In keeping with his knowledge, as a result of financial debt owed to town of Cape Town, the CTMCA decided It will be very best to provide their [Schaapkraal] residence … and to also to hide the property of the CTMCA to stay away from the sheriff from attaching the residence.”

JP Smith, Cape City’s mayco member for safety and security, has Formerly told GroundUp that the CTMCA “threw income absent” on litigation with the town.

“Annually like clockwork, as we solution the tip of your calendar year, the CTMCA picks a authorized battle with the City, around permits or another thing. We never initiate it. They continue to keep throwing revenue absent on vexatious litigation that they lose and also have fees awarded towards them. That is totally self-inflicted,” he mentioned.

Soeker advised the Dabishi Nthambeleni investigators that the primary position gamers on issues of Lottery funding have been Stemmet and previous CTMCA board member Kevin Momberg, “who were in control of all of the admin, finances and operating cat888 the CTMCA.” The investigators claimed they were unable to Call Momberg.

Hats
For the duration of their “investigation in loco” within the Primrose Park premises, the investigators “identified quite a few devices, some in good problem, some in undesirable issue and many that seemed rusty and very outdated”. Stemmet instructed the investigators that there was also an off-web-site storage facility where by “devices and many equipment” have been retained.

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

Based upon images and invoices in GroundUp’s possession, some, Otherwise all, on the things look like gear which was illegally removed from the CTMCA’s preceding premises. Stemmet is facing prices for this removal.

According to the last development report submitted to the NLC with the CTMCA, the machinery was ordered from Martin-Conne Milliners, a business by which Stemmet, his wife and his daughter ended up administrators at enough time.

The investigators uncovered this “alarming”.

“From the CIPC search of Martin-Conne Milliners and also the invoices submitted, we note the next alarming obtaining: Mr Stemmet himself is actually a director of Martin-Conne Milliners. The registered address of the corporate is 5 Crete Highway, Wetton, Cape Town, the same deal with on which the museum was meant to be designed and/or transformed,” they noted.

An audit by accountants Kopano Included, hooked up for the investigative report, recorded which the CTMCA was in the process of obtaining “equipment, plant and inventory” valued at R8.one-million from Stalph 164 CC, trading as Martin-Conne Milliners. Staph 164 was a close corporation of which Stemmet was one among the directors.

In line with Dabishi Nthambeleni, the corporation has paid out R1.2-million to be a deposit, this means R6.9-million is still owed, though there isn't any payment day set for when this need to be paid.

The Kopano audit as well as close hyperlink involving the companies “suggest to us that there is ‘foul Participate in’ involved in the purchase of the machinery in the museum workshop”, the investigators explained in the report.

“We discover that it's remarkably possible that CTMCA made use of the funding of your NLC to ‘refund’ among its major administrators for that residence at the next overpriced fee than the particular value and value of the assets and/or machinery.”

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

“Actually, an in depth report on how the funding on the NLC was used, could well be unattainable as the CTMCA does not have any receipts, or proof of payments to verify the quantities used on Each and every merchandise it requested funding for. The interim report and ultimate report with the CTMCA only connect invoices,” Dabishi Nthambeleni concluded.

The investigators uncovered which the NLC experienced not conducted a website go to just before approving the grant. But this was not standard observe at some time plus they identified no evidence of carelessness by NLC staff.

At the time, the NLC’s regulations did not involve funded organisations to submit evidence of payment with interim reviews, they identified. This intended that the CTMCA was ready to receive a 2nd tranche of funding without having to give proof that it had applied the very first tranche for its meant reason.

Following the appointment of a whole new board, commissioner and senior govt workforce, the NLC has tightened up on these and also other challenges.

Dabishi Nthambeleni advised that

the NLC decrease any foreseeable future funding purposes within the CTMCA;
the CTMCA and any members who had been involved in the grant be subjected towards the NLC’s “delinquency” procedure;
the NLC open a criminal circumstance of fraud with SAPS or maybe the Hawks for allegations of fraud; and
the NLC start off the entire process of recovering the misappropriated funds.
But, as opposed to act around the report’s suggestions, the NLC – below its former administration – chose to suppress it, since it experienced completed with the preceding reports into corruption it had commissioned.

GroundUp sent inquiries to Stemmet and Soeker via SMS, and requested for e-mail addresses to mail the concerns by e-mail far too. But no reaction were gained at enough time of publication.



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