South African tribunal orders repayment of R25m in diverted NLC lottery funds
The tribunal ruled that the grant process was unlawful and set aside the funding award.
South Africa.- A South African Special Tribunal has ordered the South African Sports Confederation and Olympic Committee (SASCOC), along with several individuals and entities linked to former National Lotteries Commission (NLC) officials, to repay nearly R25m (€1.30m) after finding that lottery funds intended for a Rio Olympics-related project were unlawfully allocated and diverted.
The ruling stems from a Special Investigating Unit (SIU) case into the misuse of National Lotteries Commission funding, with the tribunal finding that the grant process was unlawful and that the money was not used for its intended purpose. The order concerns a R24.98m (€1.30m) grant approved in 2016 for a Rio Olympics roadshow and athlete send-off programme.
According to the SIU, SASCOC applied on behalf of the Mshandukani Foundation, which had been registered only months earlier, and the grant was approved within six days. SASCOC then transferred almost all of the money to the foundation, which investigators say channelled funds to entities and individuals linked to former NLC officials.
Former SASCOC chief financial officer Vinesh Maharaj testified that former NLC chairperson Alfred Nevhutanda and the late SASCOC chief executive Tubby Reddy played key roles in establishing the process that led to the funding approval.
Maharaj and SASCOC were ordered to jointly repay R150,000 (€7,800) after findings that Maharaj failed to uphold his fiduciary responsibilities, despite indications that the process may have been irregular. The remaining respondents were directed to repay R24.83m (€1.29m).
Two parties, Imbizo Events and Minenhle Dlamini, were excluded from the repayment order after previously reaching settlement agreements with the SIU and complying with the terms.
