South Africa


Minister of Justice Ronald Lamola’s law firm bungled National Lottery corruption probe, three times

Minister of Justice Ronald Lamola. (Photo: Gallo Images / Sharon Seretlo) | A National Lotteries Commission sign. (Photo: Raymond Joseph)

Reports submitted by Ndobela Lamola Inc are full of forged documents.

First published by GroundUp 

  • Three forensic reports into National Lotteries Commission funding have found no evidence of corruption.
  • The seven-month probe cleared Phillemon Letwaba, who was accused of nepotism in connection with dodgy Lotteries grants, of any wrongdoing.
  • But the reports, by attorneys Ndobela Lamola Inc, are littered with forged documents.
  • Financial statements attached to the reports make no sense.
  • A key witness was not interviewed.
  • Ronald Lamola, now minister of justice, was a director of Ndobela Lamola Inc, when two of the reports were submitted.
  • While Ndobela Lamola Inc refuses to say how much they were paid for the three bungled reports, the firm received R19-million in fees for work done for the Lotteries Commission between 2016 and 2020.

Three forensic reports compiled by a high-profile firm of attorneys commissioned by the National Lotteries Commission to investigate corruption with lottery funding are littered with forged documents.

Minister of Justice Ronald Lamola was a director in the firm, Ndobela Lamola Inc (NL Inc), when two of the reports were submitted.

GroundUp reported late in 2018 how a hijacked non-profit company, Denzhe Primary Care, was used to apply for millions of rands in lottery grants to build a drug rehabilitation centre near Pretoria. The centre was never finished and at least R20-million of the R27.5-million given to Denzhe is unaccounted for.

The story also revealed how the brother of the National Lotteries Commission’s Chief Operating Officer, Phillemon Letwaba, headed up a construction company that received the contract to build the centre.

NL Inc was subsequently commissioned by the National Lotteries Commission to investigate and “to ascertain the veracity of allegations made” in newspaper reports regarding Denzhe.

The reports, submitted to two successive ministers of trade and industry, include forged affidavits and proof of payment receipts, a bogus annual financial statement, and forged resolutions supposedly passed by Denzhe Primary Care. These include a resolution claiming that Denzhe’s founding directors had resigned and appointing three new directors, who were behind the hijacking of Denzhe. One of the resolutions also gave the three “new” directors signing powers on the company’s bank account.

The documents are included in annexures to the three reports, dated 3 March 2019, 3 May 2019 and 30 September 2019. The reports, which have never been made public, were rejected out-of-hand by two ministers charged with oversight of the Lotteries Commission.

When two of the reports were submitted to the National Lotteries Commission, Lamola was one of two directors of the firm, which still bears his name. His name features as a director on NL Inc letterheads included in the first two reports. At the time, the firm was small: it had two directors, three associates and two candidate attorneys.

Lamola was appointed to Cyril Ramaphosa’s Cabinet on 30 May 2019, 27 days after NL Inc produced its second report. But he is recorded as having resigned as a director of NL Inc several months later, on 2 September 2019, according to Companies and Intellectual Properties Commission records.

The NL Inc reports, which run to almost 700 pages, consist of voluminous annexures that include duplicate copies of documents, and numerous photocopied photographs that are barely legible. The reports are superficial, poorly researched and edited, and are littered with spelling mistakes and poor grammar. In some cases, annexures referred to are not appended.

Dodgy documents

Many of the documents that NL Inc quoted and also used to reach its conclusions are forgeries.

Dodgy documents in the reports include:

  • A 2018 financial statement included as an annexure, which was allegedly signed off by Denzhe founder Takalani Tshikalange. (Tshikalange was unaware that the dormant non-profit organisation had been hijacked until she received SMS alerts of movements of large sums into and out of its account). The signature on the financial statement is different to the one on an affidavit that Tshikalange made to police soon after she discovered that Denzhe had been hijacked. Tshikalange told GroundUp that she knew nothing about the financial statement and the signature was a forgery, and not hers.
  • A fraudulent affidavit supposedly sworn by Tshikilange soon after the GroundUp story under investigation by NL Inc was published. Tshikalange has categorically denied knowledge of this affidavit and says the signature on it is a forgery.
  • A fraudulent Denzhe board resolution appointing controversial Pretoria lawyer Lesley Ramulifho as chairperson, replacing Tshikalange, after the organisation was hijacked.The resolution also gave signing rights on Denzhe’s bank account to Ramulifho and Liezl Moses, one of his employees, as well as Themba Mabundza, an active director of over 50 companies, and a director of several companies linked to Philemon Letwaba. Tshikalange denied knowledge of the resolution and said her signature on it was forged.
  • A fraudulent Denzhe resolution “reappointing” Tshikalange as Denzhe’s chairperson. Tshikalange told GroundUp that she had never resigned as chairperson and her “signature” on this document was a forgery.
  • Fraudulent proof of bank payments provided by Ramulifho, that purport to prove that Ramulifho repaid lottery funds “borrowed” from Denzhe to buy two Ocean Basket restaurant franchises for himself. GroundUp has laid a criminal complaint with police, as well as lodged a complaint with the Gauteng Legal Practice Council (LPC), setting out evidence of how Ramulifho used forged documents in a legal matter he is pursuing against them. The LPC dismissed the complaint. GroundUp has applied for this decision to be reviewed in the Gauteng High Court, and the LPC has elected not to oppose. A criminal complaint of perjury has also been laid against Ramulifho with police. Two forged “proof of payment” receipts totaling R535,240.31 to Ocean Basket are documents in GroundUp’s case.
  • An email exchange in which Tshikalange appears to answer questions about Denzhe, and completely exonerates Ramulifho of wrongdoing. Rather than a copy of the email, which would prove its provenance, the questions and answers are contained in a typed document. Tshikalange has confirmed to GroundUp that she received the questions from NL Inc, but said she had never responded. She also confirmed that she had sworn a new affidavit to an independent investigator appointed by Trade and Industry Minister Ebrahim Patel to probe lottery corruption, in which she denies key facts and identifies several of the forged documents.

There is no evidence that NL Inc were aware that they were dealing with forged documents. “In conducting our investigation, we have assumed the legal capacity of all individuals, genuineness of all signatures, the authenticity of all documents submitted to us as originals and the conformity to authentic original documents of all documents submitted to us as certified,” they said in the reports.

But the fact that documents were not properly scrutinised during a forensic investigation, as well as other glaring omissions in the reports, raises questions about the quality and thoroughness of the investigations.

After its seven month probe, NL Inc cleared Letwaba, who was accused of nepotism in connection with the dodgy Denzhe grants, of any wrongdoing. The firm also stopped short of making recommendations on several key issues, including steps the National Lotteries Commission should take to recover the Denzhe funds.

Instead, it recommended that the National Lotteries Commission wait for the outcome of a civil lawsuit before deciding how to proceed. This is an almost three-year-old civil matter in which Denzhe is suing Ado Krige and his wife, Alet, the owner of the property where the drug rehab is situated, for R17-million for construction work Denzhe says was done.

“We were… unable to make any finding on issues that are currently before the court,” the report said.

On “whether any funds could be recovered or frozen immediately”, NL Inc stated: “This step will be triggered by the outcome of the court process.”

But the case against Krige and his wife could take another two to three years to come to court, “if it ever does”, according to Paul Goosen, the lawyer acting for them.

NL Inc did find that due diligence had not been done and that Denzhe did not have any rights over the property. They recommended that beneficiaries of lottery money should supply proof of ownership, a signed offer to purchase, or permission to occupy before grants were paid.

But NL Inc dismissed the GroundUp story and suggested the National Lotteries Commission seek a retraction. It also suggested that internal leaks at the National Lotteries Commission should be investigated, as it found that the GroundUp story was based on leaks.

Key witness never interviewed

NL Inc said it made several attempts “telephonically” to meet Krige and to visit the rehab.

“Krige advised us that he is only prepared to meet with us only if we will be negotiating a settlement. In this regard, we were unable to visit the site and to obtain Mr Krige’s version of events.

“During our telephonic conversation with Mr Krige, he advised us that he has already met with people from the DTI [Department of Trade and Industry] and therefore sees no point in meeting us,” NL Inc said.

Krige told GroundUp that he had previously met Mampane and former National Lotteries Commission board chairperson Professor Alfred Nevhutanda and reported his concerns about Ramulifho and possible corruption. He had also met representatives of the DTI and the National Lotteries Commission.

“Why would I see so many different people and then refuse to see them [NL Inc]? They must prove that I said I would only see them if they would negotiate a settlement. It’s nonsense and it’s not true.”

Keeping it in the family

Denzhe signed a contract with Upbrand Properties on 25 November 2016 to construct the rehab centre, according to an annexure to the third NL Inc report. Johannes Letwaba, the brother of Lotteries Commission COO Phillemon Letwaba, was registered with the Companies and Intellectual Property Commission (CIPC) as a director of Upbrand. Upbrand was only registered in January 2016, the same year it landed the contract to build the rehab centre.

Phillemon Letwaba was placed on special leave while being paid over R265,000 a month in March 2020, after the National Lotteries Commission board appointed audit firm SekelaXabiso to investigate alleged lottery grants corruption.

Johannes Letwaba subsequently resigned from Upbrand on 1 March 2017, according to CIPC records. During the period that he was still a director, and according to bank statements, Upbrand received at least four payments totaling R3,588,700: R123,500 on 21 October 2016, for “first phase construction”; R61,200 on 10 November, for “second phase construction”; R3,350,000, on 23 November, for “third phase construction” and R54,000 on the same day for “labour construction”.

In January 2018, after Johannes Letwaba’s resignation, there were further payments to Upbrand Properties of R900,000 and R100,000.

After Letwaba’s resignation on 1 March 2017, he was replaced on the same day as Upbrand’s sole director by Keneilwe Maboa, the wife of his first cousin Karabo Sithole, who happened to be the treasurer of Denzhe at the time. She subsequently resigned on 31 October 2018 and was replaced, again on the same day, by Kenneth Sithole, another first cousin of the Letwaba brothers. Sithole resigned on 21 July 2020 and was replaced by Jim S’Thembiso Skosane, who is now Upbrand’s sole director.

Yet NL Inc reported: “In our interview with Mr Johannes Letwaba, he informed us that he does not know Kenneth Sithole.” Despite this denial, Kenneth Sithole and Johannes Letwaba are co-trustees, with Phillemon Letwaba’s wife, Daisy, of the Upbrand Properties Trust.

However, NL Inc did find that Johannes Letwaba was the sole director of Upbrand Properties when it signed the contract to construct the rehab. Yet NL Inc cleared Phillemon Letwaba of any breaches of the National Lotteries Commission’s policy on conflict of interest involving the awarding of the Denzhe construction contract to Upbrand Properties.

The report did find that the National Lotteries Commission’s conditions in the grant agreement are “too relaxed regarding the appointment of contractors.” It recommended that the National Lotteries Commission impose a condition in the grant agreement that “beneficiaries must report on the procurement of contractors and provide proof that an open and competitive process was followed in the appointment of service providers”.

But NL Inc found that Tshikalange had stated in the (forged) affidavit that Upbrand was “appointed through a competitive process, as required by the Grant Agreement. Further, Ms Tshikalange states that Denzhe had no prior knowledge of these companies nor had any relationship with its directors.

“… at all material times the CEO [Letwaba] was not aware of any conflict situation that existed. Accordingly, we find that there was no conflict of interest or perceived conflict of interest on the part of the COO in relation to the Denzhe project.”

Ministers unhappy

It is clear from their responses that neither former trade and industry minister Rob Davies, who received the first report, nor his successor, Patel, who was the recipient of the second and third reports, were satisfied with the quality and thoroughness of the investigations.

After the first report, dated 3 March 2019, was submitted to Davies, the minister replied, pointing out serious omissions. He listed 13 issues that NL Inc report had failed to deal with. These included:

  • A failure to “interview officials mentioned in the report”;
  • A failure to supply a breakdown or cost analysis of how the R27.5-million in lottery funding allocated to Denzhe was spent, besides the “mere” R535,240 paid for two Ocean Basket franchises;
  • The report was “silent” on Letwaba’s role in the approval process of Denzhe’s application;
  • No evidence was produced of a site visit to the rehab;
  • There were problems with an affidavit supposedly sworn by Tshikilange, the founder of Denzhe; and
  • Annexures were referred to, but not included in the report.

Davies asked the National Lotteries Commission to extend the terms of reference for its investigation to include “misappropriation of funds” for the rebuilding of Vhafamadi High School in Limpopo, which was destroyed during a protest. GroundUp reported that the new school experienced serious structural issues less than two years after it was built with a R28.3-million lottery grant. Davies also asked the National Lotteries Commission to probe “alleged fraudulent activities” involving a R6-million grant for a music festival in East London.

The National Lotteries Commission then extended NL Inc’s mandate. A new report, dated 3 May, 2019, was handed to the commission and a final report in September 2019. In neither was there anything to suggest that the firm had investigated Vhafamadi, as Davies had requested.

When Patel, the new trade and industry minister, who had been appointed less than a month earlier, received the second report he was far from satisfied with it.

Patel wrote to then National Lotteries Commission board chairperson Professor Alfred Nevhutanda recommending criminal charges be laid and steps taken to recover the money given to Denzhe.

“In view of the two forensic investigation reports from your independent investigators, and in light of the investigation outcome, it is evident that the Proactive Funding allocated to Denzhe was not used for its intended purpose,” Patel wrote. “… I thus recommend recovery of the funds paid to Denzhe and the pursuit of a criminal case” under the Public Finance Management Act.

The National Lotteries Commission has never laid any charges, despite the minister’s request.

After receiving the third report, Patel finally lost patience with the investigation and commissioned his own independent inquiry into corruption at the commission.

In September last year, Lionel October, the director-general for trade and industry, briefed Parliament on the independent investigation and confirmed that a dossier had been handed to the Hawks to investigate further.

The docket details investigations into multimillion-rand grants to four non-profit organisations, which are linked to Phillemon Letwaba or members of his family, and to Ramulifho.

The National Lotteries Commission subsequently made good its threat to sue Patel. Judgment in this matter has been reserved.

Numerous problems

The reports are littered with further problems.

For example, NL Inc failed to check with the Department of Social Development who the official directors of Denzhe were. Had they done so, they would have discovered that Ramulifho is not, and has never been, a director of Denzhe.

Department records for Denzhe supplied to GroundUp in May 2021 also reveal Denzhe is both dormant and non-compliant and has not met statutory reporting requirements since 2013.

Another example of poor fact-checking by NL Inc is evident in one of the questions sent by NL Inc to Tshikalange. It refers to a fraudulent affidavit in which she seems to say that she is the applicant in a civil lawsuit against Krige, his wife and their organisation. NL Inc included a copy of the summons in its reports. Had they checked the document in their possession, they would have seen that the plaintiff in this matter was Denzhe, not Tshikalange, who is not mentioned anywhere in it.

And then there are the financial statements that don’t add up.

The Lotteries Act specifies that recipients of large grants — R10-million or more — must submit audited financial statements.

But the only copies of Denzhe’s annual financial statements in the reports are for 2018 and are unsigned. There is no indication that NL Inc questioned the lack of annual financial statements for previous years.

Contrary to what the Lotteries Act requires, these financial statements are not audited and were merely “reviewed” by a consulting company, Dalia Consulting. The statements are not signed by an auditor and there is no practice number. Dated 25 April 2019, the financial statements have obvious inconsistencies, and raise questions as to whether they were properly scrutinised.

The financial statement indicates that Denzhe owns property worth R13.27-million. This, however, is not possible, as NL Inc’s own reports identify problems with the transaction between House Regeneration – where the drug rehab centre is situated – and Denzhe. Even if Denzhe’s directors did plan to buy the property, the sale never materialised and the property never belonged to Denzhe.

Non-current assets are omitted from the financial statements, leaving a “missing” balance of R4.48-million.

An amount of R1.58-million is listed as a liability, which in the notes section is attributed to Value Added Tax (VAT) payable. But Denzhe has never been registered for VAT. And even if it had been, it would have been near impossible for Denzhe to “owe” SARS R1.58-million in VAT.

Another glaring inconsistency is in the revenue columns, which only list an R18-million grant from the National Lotteries Commission. Yet NL Inc had in its possession a summary of tranches paid to Denzhe, totalling more than R27.5-million.

There are no opening balances, with no references to what had happened in previous years. The notes spell out how depreciation is calculated, but never show the calculation. Apart from ludicrous expenses of R2.166-million for staff for a rehab centre that is unfinished and non-operational, there are no “line items” such as bank costs, telephone costs or stationery, which one would expect from an operating centre. And with such a salary bill one would expect liabilities such as PAYE and UIF, but none are listed.

The annual financial statement lists R9-million in equity, describing it as “share capital”. It is unclear why anyone would invest R9-million in a non-profit organisation. This money is also not reflected in the bank balance.

When first contacted, Valentine Zinhumwe, the executive director of Dalia, said he “knew” Ramulifho but had not heard of Denzhe or Upbrand Properties. Later, he referred to Ramulifho as a “client” and said he could not discuss his client’s financial affairs.

“You are free to write what you feel is true but I can’t comment further than this,” he said.

It is not known how much NL Inc was paid for the three-part investigation, which was conducted over the course of 2019. But in a written answer to a question posed by Mat Cuthbert, the DA shadow minister for trade and industry, Lotteries Commissioner Thabang Mampane said that NL Inc had earned over R19-million in fees for work done for the National Lotteries Commission between 2016 and 2020.

This answer to Parliament reveals that NL Inc booked more business with the commission than any other law firm between 2016 and 2020. NL Inc accounts for 25% of the R75.69-million paid to 37 law firms over the four year period.

‘Faceless informants’

Finally, NL Inc dismissed the GroundUp story out of hand. The story was based on leaked and public documents, public records and other information in the public domain, as well as first-hand information based on a visit by GroundUp to the rehab, and interviews with several key people who were all identified by name.

But NL Inc suggested that the National Lotteries Commission seek an apology and retraction of the article. Weighing up “the evidence of two affidavits” (both forgeries) against “the article with faceless informants”, NL Inc found no substance in the allegations made by GroundUp.

Right of reply

Questions were sent to Justice Minister Ronald Lamola via email to his spokesperson, Chrispin Phiri. When a reminder was sent to Phiri that the seven-day deadline was about to expire, he responded: “Thanks sir, please note the law firm will be dealing with the enquiries.”

Pressed further, Phiri said: “The work was done not in his personal capacity. It was done under the auspices of the client through the firm. So the firm can best explain its process and which director did what, etc.” And, “None of these processes pertain to the individual Ronald Lamola. You need to separate the two.” He said the National Lotteries Commission “did not contract with Lamola, but a separate entity in the form of Ndobela Lamola Inc”.

Detailed questions were also sent to Rhulani Ndobela, now the sole director of NL Inc.

He initially responded that he was “not at liberty to respond” due to a client confidentiality agreement with the National Lotteries Commission.

But the following day, Ndobela sent a second response, in which he described the questions sent to NL Inc as being “littered with [a] complicated set of logical incongruity”.

He confirmed that Lamola “has indeed resigned” and said: “The details and extent of our involvement are covered by attorney and client confidentiality, and thus, you are most welcome to address your questions on this matter directly with our client”. He added: “We have no further statements in so far as the rest of the allegations made against our firm.”

We sent the National Lotteries Commission detailed questions. Their lawyers responded with a brief letter stating that the matters referred to were under investigation by the Hawks and SIU. “We have subsequently advised our client not to respond to your questions until the above investigations have been concluded.”

Both Lesley Ramulifho and Phillemon Letwaba failed to answer detailed questions sent to them. Ramulifho was sent the questions via WhatsApp and two email addresses he uses. Letwaba was sent questions via a WhatsApp number on which GroundUp has previously communicated with him. DM


Comments - Please in order to comment.

  • Diablo DC says:

    Cyril needs to get all his current ministers of mischief out of the box. NOW!

    • Wilhelm Boshoff says:

      Why if Cyril’s people are incompetent, do we accept him to be different?

    • Alley Cat says:

      Sadly, I rated Lamola as a competent minister, but in the back of my mind I thought that I might be disappointed, as I have been with other ministers that I rated, when his skeletons are exposed. And here they are.
      Are there ANY ministers who are competent and not involved in shady deals?
      Reverse robin hood. Steal from the poor and give to the rich.

      • Paddy Ross says:

        I agree with your opening words and this article on DM is of serious concern. However, don’t jump to conclusions until Lamola’s personal involvement is revealed or excluded.

        • L H says:

          The problem is, for such a small law firm at the time, he must have been involved in the report in some capacity. The sub par quality of the report is concerning and one can easily see why our government is defunct if these are the best we can find.

          • Paddy Ross says:

            What I found worrying was that the NLC, which was strongly suspected of corruption , chose this firm presumably expecting a whitewash. Ronald Lamola might have been too busy climbing the political ladder to have any direct involvement in the report. Only time will tell.

  • Rian Rademeyer says:

    Wow! looting on the ground and looting at the top. The rest of us caught in the middle of a country spiraling out of control. Well done investigation 3 attempts to sweep this under the carpet. Will anything come of it?

  • Laurence Erasmus says:

    Is anyone in Cyril’s cabinet beyond reproach? It seems not!

  • Gordon Pascoe says:

    Here we go yet again. Rampant corruption and coverups everywhere.

  • Jane Crankshaw says:

    This is the problem with BEE policies – apart from being unbelievably racist, the wrong people end up doing a bad job at best….a fraudulent corrupt job at worst!

  • Andrew Gunn says:

    Are we surprised, the only immunity we’re developing is for corruption

  • Lee Richardson says:

    Jail. Please?! There is no justice in this country. The NPA has had 4 years and we have to face that Batohi is not up to the task. Is competency too much to ask?

    • DONALD MOORE says:

      Batohi I believe is up to the task but the department she inherited was seriously hollowed out by the Zuma years. 4 years is not a long time to rebuild the NPA. The NPA is now starting to show its renewed competence so we should all give it time to do its job – it is a very big and difficult job!

  • MIKE WEBB says:

    cANCer is all in the family.

  • Dennis Bailey says:

    Yee gods, when will it end. Does the ANC have one shred of credibility?

  • Lorinda Winter says:

    Oh no and just when I thought there was one incorruptible minister in cabinet! Our President can choose them, ouch!

  • Ian Gwilt says:

    I thought he was one of the better guys
    The way I understand it, this was a report/reports commissioned by the lottery’s commission
    Hardly surprising that they found themselves innocent
    Is there not a case being investigated by the NPA ?

  • Geoff Young says:

    The ANC is focused only on staying in power to plunder the country and keep its members out of jail. That is its real manifesto. It is not a political party, it’s a PR-spun front for a criminal organisation and we are all its victims. Google the definition of “failed state”.

  • Just Me says:

    The ANC led Govt just cannot produce accountability whatsoever. And what makes this worse is that the recipients of Loto funds are supposed to be truly worthy recipients and they are not getting anything but lies and deceit.

  • Bruce Kokkinn says:

    It is time for a push to prosecute the whole bunch. If this is acceptable to our government we want a new government!

    • Mattieu Theron says:

      How do we put more pressure on? How do we make this heard? Simply reading these investigative pieces and commenting isn’t enough. What can we do? I am looking for something to get behind, I think many of us are…

  • Dieter Butow says:

    Nothing will change in this country unless the funds they are stealing dry up. Join the taxpayers union so we develop a strategy and clout to move forward

    There is no untainted minister and Cyril is not in a position to replace any with competent persons – he is not really the person making the decision on his cabinet, it seems.

  • Mattieu Theron says:

    How do we put more pressure on? How do we make this heard? Simply reading these investigative pieces and commenting isn’t enough. What can we do? I am looking for something to get behind, I think many of us are…

    • Geoff Young says:

      Excellent and pertinent questions. The problem and real shame is that decent people tend to avoid getting involved in politics. Nobody I respect or know on a first-name basis is in any remote way a political influencer beyond their right to vote (or comment on forums like this). There is a massive opportunity here and it will be filled, either with mostly good people, or the reverse. Cyril is in a position to decide that pivotal direction right now and the whole world is watching while he pointlessly wrings his hands and confers with his fellow gangsters.

  • Nick Griffon says:

    Absolutely every single person in the ANC is a bloody criminal.
    The ANC is a criminal gang, not a political party.

  • Tim Price says:

    I am always amazed at the fees these tin pot firms/individuals are paid. People are conditioned to believe legal fees are huge because of US TV shows but the reality is that fees are restricted and tariff based. The kind of fees charged by Hlope’s lawyer and Lomola’s firm are simply another version of corporate corruption, extracting unjustified amounts from the State, just like any crooked contractor.

  • John Strydom says:

    Great reporting, thank you!

  • David Purchase says:

    Great article. Well investigated and reported, thank you.

  • L H says:

    It is simply impossible for the ANC to self correct. It is too far gone.

Please peer review 3 community comments before your comment can be posted


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