The National Lotteries Commission says it has no records of whether or not its R9.59 billion in investments over a number of years was approved by the National Treasury.
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The National Lotteries Commission (NLC) has admitted that it has no records of whether or not the Minister of Finance approved over R9.59 billion in investments in financial institutions made over a four-year period.
The Special Investigating Unit (SIU) is probing the investments made between January 2014 and May 2017.
Between January 2014 and March 2015, the commission invested over R5.6bn and more than R3.23bn between June 2015 and November 2015, another R599m was invested between August 2016 and February 2017 as well as R137m between April 2017 and May 2017.
According to the SIU, one of its mandates is to investigate the investment of funds by NLC. The NLC has indicated that it invested the funds in various financial institutions.
“The Lotteries Act allows the commission to invest funds in the Public Investment Corporation (PIC),” the NLC explained in response to questions.
The commission continued: “With regards to the other financial institutions, used for investment purposes, the NLC can confirm that the organisation has no record of whether this was approved by the Minister of Finance or not.”
The investment of the funds was guided by the NLC’s investment strategy, reserve strategy, investment policy and delegation of authority.
Last month, the SIU indicated that it requested some documents relating to the investments and to this date the Unit has not been provided with any investments approval documents and/or authorisation of the investments by the finance minister.
The NLC said all documents relating to investments that were available have been shared with the SIU.
“Furthermore, the SIU investigation of this matter is currently underway and the NLC is eagerly waiting for its conclusion. The commission will only act based on the findings and recommendations of the investigation report,” the entity added.
In terms of investing money not immediately required the Lotteries Act makes provision for this and states that “any money of the fund or the board, which is not required for immediate allocation, may be invested with the PIC or with a financial institution approved by the Minister of Finance and may be withdrawn when required”.
The National Treasury has also stated that the National Lotteries Act regulates the treatment of funds not immediately required as well as unexpected balances of the NLC.
“In this regard, the National Lotteries Act requires that any unspent funds of the NLC be transferred back to the National Lotteries Distribution Trust Fund (NLDTF).
Furthermore, section 25 of the National Lotteries Act prescribes that ‘any money of the fund or the board which is not required for immediate allocation, may be invested with the PIC or with a financial institution approved by the Minister of Finance and may be withdrawn when required’.
According to Treasury, this allows the NLDTF to invest any unspent monies or surplus funds with a financial institution as regulated by Treasury Regulations.
loyiso.sidimba@inl.co.za