Minister of Trade and Industry Parks Tau has instructed the National Lotteries Commission (NLC) to investigate new allegations of political connections linked to Sizekhaya Holdings, the winner of the fourth lottery license. This announcement follows the successful award of the license, which Tau stated does not imply any flaws in the selection process, but rather shows his commitment to maintaining the integrity of the licensing.
In May, Tau announced that the Sizekhaya consortium would operate national lotteries for the next eight years. However, Ithuba Lottery, a losing bidder, has taken legal action against Tau in the Pretoria High Court, seeking a halt to the license award to Sizekhaya. Ithuba claims that Deputy President Paul Mashatile has an indirect interest in Sizekhaya through his sister-in-law, Khumo Bogatsu, a co-owner of Bellamont Gambling (a shareholder of Sizekhaya), as well as through close associate Moses Tembe, who chairs Sizekhaya and is also a Bellamont shareholder.
Additionally, Sandile Zungu, also part of the Sizekhaya consortium, allegedly has connections to Mashatile through the ANC. In his affidavit, Tau denies any direct or indirect financial interest by Mashatile in Sizekhaya, asserting that Ithuba has failed to provide evidence linking Bogatsu, Tembe, or Zungu to political office. He states that Ithuba’s claims are based on media speculation and personal relationships rather than concrete evidence.
The NLC, which opposes Ithuba’s application, has confirmed that an investigation is ongoing. However, many details in the affidavits filed by all parties have been redacted. Ithuba launched its urgent application in September, following a pending review application to set aside the award entirely. Ithuba Lottery, a sister company to Ithuba Holdings (which previously operated the lottery under the third license), is currently running the lottery under a temporary license granted by Tau.
Ithuba argues that the decision-making process was flawed due to a series of irregularities. They allege that Tau and his committees abandoned the scoring criteria outlined in the Request for Proposals (RFP) and instead adopted subjective scoring methods. Ithuba contends that this disregard for the established rules should prevent Sizekhaya from taking over the lottery operations before the review.
One major concern raised by Ithuba involves the alleged political connections. While Tau has initiated an investigation into these links, Ithuba claims it has not been informed of the investigation’s outcome or whether it has been completed. Additionally, Ithuba criticizes the minister for not addressing why these connections were overlooked during the bid evaluation process.
Tau stresses that the ongoing due diligence is part of a continuous oversight effort and does not invalidate the award to Sizekhaya. He describes the allegations of political connections as mere hearsay, asserting that there is no prohibited financial interest in Sizekhaya from any political party or office bearer.
Tau argues that Ithuba has no legal right to the interdict, stating that Sizekhaya is implementing the award “at its own risk” while being aware of the pending review litigation. He warns that granting the interdict could disrupt lottery operations and hinder contributions to public causes. “I find Ithuba’s claim that a denied interdict would harm the public interest to be contradictory and self-serving,” Tau stated. “It is the act of granting the interdict that would cause the most direct and severe harm to the public.”
In its final affidavit, Ithuba’s attorney, Johan Roodt, asserts that the irregularities are evident and that the Request for Proposals expanded the Lotteries Act requirements to include indirect financial interests. He argues that the affidavits from the minister and NLC show a failure to consider potential indirect interests, which he deems a fatal flaw. Sizekhaya has filed an opposing affidavit, but its contents remain confidential until a redacted version is submitted. The case is scheduled for argument from October 28 to 30.
