• Parks Tau, the new minister responsible for the National Lotteries Commission, has revealed how the NLC engaged in "lawfare" against his predecessor, Ebrahim Patel.
• The litigation was part of a fightback campaign by the NLC's previous board and management when Patel attempted to stem the corruption overwhelming the organisation.
• Almost R1.5 million in public funds was spent by the NLC on lawyers to frustrate attempts by the Department of Trade, Industry and Competition to root out corruption, but Patel eventually prevailed and a new NLC board and commissioner were appointed.
• For more financial news, go to the News24 Business front page.

The National Lotteries Commission (NLC) spent almost R1.5 million in two financial years to litigate against the minister responsible for the lottery when he attempted to stem the rampant corruption that had overwhelmed the organisation.

New Minister of Trade, Industry and Competition (TIC) Parks Tau revealed the expenditure on litigation against his predecessor, Ebrahim Patel, in a response to written questions from Democratic Alliance MP Toby Chance.

Chance had asked for details of [the NLC's] legal and consultants' costs "relating directly or indirectly to the ministry, any media house or journalist and parliamentarian".

The "lawfare" revealed in Tau's response was incurred during the 2019/20 and 2021/22 financial years.

Tau listed several matters in which the NLC had litigated against Patel.

Patel told Parliament in 2022 how "lawfare" and a "fightback campaign" were launched against him when he tried to address NLC governance issues and hold its board and executive to account.

Patel said that "funds of the NLC meant for the most vulnerable communities and projects (old-age homes, drug rehab centres and centres for young children), were cynically and brazenly stolen by an organised syndicate of persons".

"Syndicates responsible for looting public funds were able to rely on a network of professional firms that enabled the monies to be redirected, and these syndicates had sophisticated methods to cover up their actions and deflect attention," he said.

"Courageous individuals, ranging from whistleblowers to journalists and investigators, were essential to uncovering wrong-doing and showing the channels through which monies flowed between the NLC and recipients, bypassing the intended community beneficiaries."

Patel listed nine legal actions as examples of the NLC's strategy of costly and sustained litigation against him that was funded by public money.

He said, "When it was apparent that the department was serious about acting against corruption, various measures were put in place by third parties and individuals in the NLC to frustrate the department."

These included:

• In March 2020, a large number of people were "bussed in at great expense" to protest outside his office against the disclosure of information about the identity of individual beneficiaries. (The NLC finally relented when the portfolio committee ordered that the details of its beneficiaries be disclosed.)
• Threats of legal action and letters from attorneys "which appeared to be orchestrated and required detailed responses to be formulated".
• Cases launched at the High Court and in one matter, a petition to the Supreme Court of Appeal.
• Reports of arson, tampering with vehicles and action against whistleblowers.
• Numerous "anonymous and slanderous attacks in the print and social media against an investigative journalist [this reporter] and the Ministry" and its "motives for seeking to investigate the allegations of corruption".

Patel eventually prevailed. A new NLC board and commissioner were appointed, and it appears that they have made a concerted effort to improve the institution's governance.

Litigation against the minister

Litigation against Patel included an application by former NLC Commissioner Thabang Mampane to force him to appoint a new NLC board. Her application was launched just days after Patel had told Parliament that he had instructed his lawyers to end the terms of the three remaining members of the NLC's board and soon after applications and nominations closed for new NLC board members.

In 2020 lawyers acting for the NLC wrote to Patel to demand that he hand over a dossier into alleged corruption involving several dodgy Lottery-funded projects that had been handed to the Hawks to investigate. The projects were linked to Pretoria lawyer Lesley Ramulifho and Phillemon Letwaba, the NLC's former chief operating officer.

The Pretoria High Court had dismissed an application by the NLC early in 2022 to set aside the appointment two years earlier of independent investigators commissioned by Patel to probe corruption involving the NLC.

Patel named three organisations – United Civil Society in Action (UCSA), Zakheni Ma Afrika and African Liberty Movement – which had litigated against him.

Although the NLC was listed as one of the respondents in all these matters, all three organisations put forward arguments similar to those the NLC has used to claim that it would be illegal for details of grants to be made public.

UCSA also attempted to sue GroundUp but withdrew the matter and agreed to pay the news agency's legal costs (which it has not done).

UCSA, headed up by Tebogo Sithathu, who was close to the NLC's previous administration, sent a lawyer's letter to Patel demanding that he not release details of organisations that had received Lottery grants.

GroundUp reported earlier this month how Sithathu is involved in a new fightback to dislodge the current NLC board and commissioner.

Zakheni Ma Afrika and the African Liberty Movement both unsuccessfully tried to stop the publication of details of grants and sued Patel. Zakheni received a total of R1.2 million in Lottery grants between 2020/21 and 2021/22.

In a 2021 response to a written parliamentary question by DA MP Mat Cuthbert about the cost of litigation, the NLC said it had spent R380 000 on the Zakheni and R370 000 on the African Liberty Movement matters. The litigation by UCSA was also mentioned in the response, but a figure for the NLC's legal costs was not stated.

The same response revealed how the NLC had spent tens of millions of rands on lawyer's fees since 2016.

GroundUp reported last week how the NLC has spent over R73 million on litigation and disciplinary inquiries involving past and current staff.

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