A senior Athletics South Africa (ASA) executive, after repaying nearly R400,000 he had used to pay for personal expenses from a dodgy multimillion-rand Lottery grant, could still face prosecution.

Terrence Magogodela, ASA’s acting Chief Executive Officer, played a key role in an allegedly corrupt R15-million lottery grant to Inqaba Yokulinda, a non-profit organisation (NPO), meant to oversee and manage a project to build an athletics track in Kimberley.

Read more in Daily Maverick: Lottery whistleblower ‘pressured’ to pay IT company to build athletics track 

Magogodela, ASA’s chief financial officer at the time, was listed as the project coordinator of Inqaba Yokulinda in the grant application submitted to the National Lotteries Commission (NLC), even though he was an official of ASA.

Inqaba Yokulinda paid R10-million of the R15-million grant to Unicus Solu(IT)ons (Pty) Ltd, owned by Jabu Sibanda, which was to be responsible for developing the athletics track.

But rather than use the money for the track, Sibanda spent millions on things unrelated to the project, including settling personal debts.

Athletics South Africa boss Terrence Magogodela. (Photo: Supplied by SIU)

A letter endorsing the project, supposedly signed by ASA President Aleck Skhosana, was included in the Inqaba Yokulinda application. But ASA spokesperson Sifiso Cele previously told GroundUp that Skhosana had refused to sign the letter endorsing the project as the request “did not conform to our relevant policies”.

Money from the grant was also used to cover legal and transfer duties on a house Magogodela bought in an upmarket Centurion housing estate.

Magogodela repaid almost R400,000 to the Special Investigating Unit (SIU), which on 25 April said it would apply for a court order to lift a Special Tribunal preservation order over his house.

“However, the settlement agreement does not constitute a full and final settlement between the parties,” the SIU said. “SIU remains entitled to join Mr Magogodela in any future proceeding and claim appropriate relief from him.”

The athletics track was eventually completed by Inqaba Yokulinda, who took over the management of the project after the NLC allocated a further R4.27-million in 2019.

Special Investigating Unit (SIU) graphic following the Lottery grant money meant to build an athletics track. (Supplied by GroundUp)

Magogodela’s R400,000 ‘loan’

Magogodela claimed the R400,000 was a “loan” from Unicus’s Jabu Sibanda, which he was repaying. He initially opposed the preservation order. In an affidavit, he denied that he “unduly benefited” or was involved in any “irregular conduct”.

However, he did subsequently enter into an agreement with the SIU to repay the money. The SIU is tasked with recovering corrupt funds.

A comprehensive document setting out the SIU case against Magogodela was sent anonymously to ASA. GroundUp was also sent the document by a source whose identity is known to us.

The document examines the terms of the “loan” from Sibanda in which Magogodela would have to pay interest at 9% per annum from 1 March 2018 until it was repaid. However, repayments would only start on 1 September 2018 with monthly instalments of R2,500. There was also a 10% “collection commission” payable on every instalment.

“The AoD (admission of debt) and its payment terms are not, as Mr Magogodela and Mr Sibanda contend, standard arms’ length commercial terms”, the document points out. “Ignoring the accumulation of interest and assuming that the 10% “collection commission” is paid separately, it would take Mr Magogodela until December 2031 to repay the capital alone.”

Magogodela initially failed to honour the separate settlement agreement he had reached with the SIU to repay R388,733, which included legal costs, curator costs, and “the amount that he was unduly enriched of”, the SIU said in its statement.

The SIU then approached the Special Tribunal for an application, granted in February 2022, to freeze his Gauteng home.

Magogodela’s lawyer, Dev Maharaj, denied that Magogodela had failed to honour the settlement agreement with the SIU to repay the “loan” money but had “merely requested more time to raise the final instalment”.

“There was indeed a legitimate loan from Mr Sibanda but that loan to him was not repaid fully,” Maharaj said. “Mr Magogodela felt that it was a moral obligation on his part to repay the full amount to the SIU when he learnt of the actual source of the funds from where the loan amount was paid.”

There is now a legal dispute between Magogodela and Sibanda regarding repayment of the outstanding “loan” amount, which has been referred for arbitration and “it will be premature to comment on it”, Maharaj said.

Magogodela not off the hook

A source with direct knowledge of the investigation said the SIU docket on Inqaba Yokulinda had been sent to the NPA “a long time ago” with a recommendation that the people involved be “criminally prosecuted”.

This is one of at least 30 Lottery-related corruption cases in the hands of the NPA awaiting a decision on whether or not to prosecute.

“Mr Magogodela will be very surprised if he is prosecuted as he has co-operated fully with the NPA and expects to be a witness for the state,” Maharaj said.

The source also revealed that the SIU had received a formal request from lawyers acting for the ASA for details of Magogodela’s involvement in the grant. It was believed that ASA had planned to hold a formal disciplinary inquiry, the source said, but was unaware if it had taken place.

Maharaj denied that the ASA’s attorney had requested a copy of the docket, “and is not entitled thereto, especially since no criminal charges are pending against Mr Magogodela”.

He also said that Magogodela had not faced a disciplinary inquiry “as the loan was a private matter not involving ASA”.

ASA spokesperson Sifiso Cele failed to respond to questions, including whether Magogodela had faced a disciplinary inquiry and, if so, its outcome.

Jabu Sibanda splurges

The Kimberley athletics track project was supposed to have been managed by Unicus Solu(IT)ons, a company headed by Jabu Sibanda, which had no experience building athletics tracks.

Soon after the NLC paid the grant to non-profit organisation Inqaba Yokulinda, it in turn paid R10-million to Unicus on Magogodela’s instructions, according to Buyisiwe Khoza, the organisation’s director.

This first payment was meant to cover, among other things, “preliminary design, specifications and bill of quantities, quality control and project management”, according to a letter from Sibanda to Khoza.

Khoza said that when she first spoke to Sibanda he had introduced himself as the NLC’s provincial head in Mpumalanga.

“Sibanda informed me that the [former] Chief Executive Officer of NLC, Charlotte Mampane and the [former] Chief Operating Officer of NLC, Phillemon Letwaba, and the [ex NLC board] chairperson [Alfred Nevhutanda] had sent him to approach me to assist to build athletic tracks for the North West, Mpumalanga and Northern Cape.”

Money in, money out

Before the R10-million landed on 12 March 2018 in Unicus’s account, its balance was only R1,925.

Instead of the money going towards building the track, millions were paid out for things unrelated to the grant. This included R2.5-million to attorneys handling the purchase of a mansion in Pretoria for former NLC board director Alfred Nevutanda, according to a Unicus bank statement.

Sibanda also paid off R2.2-million he owed to Clippers, a financial services company; R1.87-million to a Unicus Standard Bank account; R2.5-million to “Ncasa”; R806,550 to a software company; and R265,840 to two different vehicle sales and repair companies. (The Special Tribunal froze several vehicles belonging to Sibanda.)

There was also a payment of R58,500 to Being Human, a health and “detox” spa in Westville, Durban, for a weeklong treatment for him and his two sons.

By 7 April there was just R1.78-million left in the account and no further deposits had come in, other than the R10-million payment from Inqaba Yokulinda.

Contract cancelled

Inqaba Yokulinda director Buyisiwe Khoza previously told GroundUp that she had contacted the NLC when she realised there was a problem after Sibanda told her the money “was finished”. Both Khoza and Inqaba Yokulinda were included in the Special Tribunal preservation order.

In July 2018, she visited the NLC offices in Pretoria and met then-COO Letwaba and Tsietsi Maselwa, at the time the organisation’s legal head, to complain about Unicus.

“They said to me that they would retract the monies. In the same month, I cancelled the contract with Mr Sibanda, requesting him to pay all the R10-million back as it was meant for development.”

Despite a written undertaking to pay back the money, Sibanda failed to do so, Khoza said. “I regret that I never opened a case prior to finally reporting it [to the NLC]. I was scared, I was advised that my life was in harm’s way,” Khoza said.

The NLC’s response was to give Inqaba a further R4.3-million on 25 September 2019 to complete a project it had already paid for.

Inqaba hired a new contractor, which used mostly local labour, to lay the tracks. They also renovated and painted the stadium, renovated the change rooms and fixed broken and leaking taps and toilets, even though this was not part of the funded project.

Work began in October 2019 but was delayed by heavy rains and only completed in February 2020. It cost just over half of the R10-million that the NLC had already paid only for the athletics track.

Khoza says her life was turned upside down after she started asking questions about the missing R10-million. She says she began receiving threats and felt “intimidated” after she was visited by “fake police officers” asking questions about the project.

In an affidavit opposing the preservation order against himself and Unicus, Sibanda raised several technical issues, including a claim that the SIU’s founding affidavit against him was based on “hearsay.” He also argued that the SIU had failed to prove that the frozen property was “the proceeds of unlawful activities”.

Sibanda did not respond to questions sent to him via WhatsApp and email. DM

First published by GroundUp.