Judge Margaret Victor, ruled that a scheme owned by brothers Tshimangadzo (T Mukutu) and Ndoweni Mukutu (N Mukutu) was “clearly fraudulent.”
About R14 million was awarded by the National Lotteries Commission (NLC) to the Madumelani Community Project, but the Judge concluded the Mukutu brothers, Netswinganani, Mukondeleli, Mudonde Events and Investment, RUM Management Consultancy, Ndhava Management, and Thwala Front, acted together with the intent to defraud the NLC and are therefore, jointly liable to pay.
She declared the scheme unlawful, invalid, and set aside, and ordered beneficiaries to repay the funding received.
The grant was intended for the construction of a cultural village in Hammanskraal, Gauteng Province, an existing project of the Maubane Cultural Village and Community Arts and Centre.
The Special Investigative Directorate (SIU) found Maubane established the project in 2015, not by the Madumelani Community Project, following receipt of a grant of R300,000.00 from the NLC.
“In this case, the facts are such that the conduct of the antagonists is unconscionable, which justifies the piercing of the corporate veil. Money earmarked for a cultural village, a pride and joy of any community, has been lost to a fraudulent scheme,” Judge Victor added.
An SIU investigation uncovered how the scheme involved extensive planning and deliberate misrepresentation, including the unlawful use of the Madumelani Community Project’s constitution, the appointment of fictitious office-bearers, the submission of fraudulent signatures, and the opening of a bank account through which millions of rand were disbursed.
The Madumelani Community Project, a non-profit organisation (NPO), did not apply for NLC funding and were unaware of the grant application process.
Instead, T Mukutu fraudulently submitted the application, falsely claiming to be a director of the organisation.
Further evidence from the SIU’s probe revealed that the brothers had previously approached the project’s members, obtained a copy of its constitution under the pretext of assisting with funding applications, and later used it without authorisation.
Several individuals listed as members in the application confirmed that they had no knowledge of the submission and that their signatures had been forged. The probe also uncovered misrepresentation regarding the purpose of the funding.
Other respondents cited in the matter include Dzata Accountants, which allegedly prepared false annual financial statements, as well as several companies and close corporations associated with the Mukutu brothers.
Following the disbursement of funds in February 2018 into a newly opened bank account, substantial payments were channelled to various entities and relatives, including companies associated with T Mukutu.
“Between March and July 2018, the Madumelani Community Project made nine transactions with RUM Management Consultancy, owned by N Mukutu, totalling R3,070,000.00. In March 2018, Ndhava Management Consulting, owned by Tshisimba Collin Mukondoleli, received a payment of R4,999,000.00. On the same day, Thwala Front, owned by Mukondoleli’s wife, Kharivhe Fulufhelo Promise, was paid R1,400,000.00. Thwala Front then deposited R1,000,000.00 into a money trading account. On the same day, R50,000.00 was paid in salaries, and R400,000.00 was recorded as a hardware purchase” said the SIU in a statement.