The Ugandan authorities have detained seven individuals accused of defrauding a Nigerian businessman of $70,000 in an elaborate counterfeit gold scheme, showing the persistence of precious metals fraud across East Africa’s informal trading networks.
The State House Anti-Corruption Unit (SH-ACU), working in coordination with the Criminal Investigations Directorate, said the arrests followed a sting operation set up with the cooperation of the victim, identified as Mark Gbillah.
Investigators allege that the accused, four Congolese and three Ugandan nationals, posed as agents and suppliers for two companies, Legacy Refinery Limited and Emerod Agency Limited, promising to deliver seven kilograms of gold.
According to SH-ACU, neither company had any legitimate gold to sell. Those in custody include Paluku Kisasi, Safari Akonkwa, Isaac Mpende, Abdul Madjid Kahirima, Mabwongo Prince, Kajjubi Tevin Kyome, and Tibasiima Barbra, also known as Katushabe Sharon.
The arrests were carried out on 12 August after Gbillah alerted the authorities. “We worked with the complainant to arrange a controlled meeting, which enabled us to detain the suspects before they could demand additional funds,” said SH-ACU senior officer Bamwiine Muhorozi.
A search of a rented property in Muyenga, an upscale suburb of Kampala, uncovered roughly 150 kilograms of counterfeit gold bars and imitation nuggets, which investigators believe were intended to lure further investors.
The incident comes amid a series of high-value gold fraud cases targeting foreign entrepreneurs in Uganda. In a separate case earlier this year, a Turkish investor lost about $150,000, while in mid-2024 another businessman was conned out of $105,000 in a fictitious transaction involving 20 kilograms of non-existent gold.
Regional data indicates that between early 2021 and March 2022, investors in Uganda and neighbouring Kenya lost an estimated $25 million to similar scams, with individual cases involving as much as $8 million. These schemes often exploit the fragmented nature of gold trading in East Africa, where weak regulatory oversight and high demand for the commodity create opportunities for fraudsters.
Bamwiine said that while SH-ACU has intercepted numerous scams in recent years, the latest arrests were notable because the suspects were apprehended during the transaction. He urged prospective investors to conduct rigorous due diligence and verify any gold-related deals with the relevant authorities.
The suspects remain in custody and are expected to be formally charged in court in the coming days. Authorities say they hope the arrests will deter further exploitation of the region’s lucrative but loosely regulated gold trade.