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Three suspects have been arrested in Nairobi for masterminding a sophisticated fake gold scam that defrauded two foreigners of more than Ksh340 million.
The scam lasted for nearly two years and began in June 2022 when Mr. Satbinder Singh’s business partner, Mr. Marco Colombo Conti, arrived in Kenya to buy 100 kg of gold. Marco was introduced to Mr. Allain Mwadia Nvita, who claimed to be a legitimate gold seller.
The initial stages of the transaction appeared to be legitimate, as Mark paid approximately $400,000 (Ksh51,672,600) through law firm Squire AfriLaw Consult Limited to cover customs duties and other related fees. In return, he received 12 kg of gold and was told he could take it as hand luggage to offset the fees he had already paid.
The beginning of the gold scam: a promising deal turns sour
However, just as Marco was about to leave Kenya with the gold, Mwadia told him that he could not take the 12 kg of gold with him because it was part of the 112 kg of gold that Marco had purchased. Mwadia suggested that Marco store the gold safely in the Mysafe Vaults located in the Gigiri Village Market in Nairobi, and Marco accepted the suggestion.
On February 5, 2024, Marco was convinced that the deal was still a sure thing, so he returned to Kenya with his business partner, Mr. Satbinder Singh, who was also interested in purchasing the gold. Upon arrival, Satbinder was introduced to Mwadia and two other key players in the scam: Lehman John Raymond and Daniel Ogot of Patvad Trading Co. Ltd. Tanzanian agent Frank Kateti was also involved in facilitating the deal.
The group discussed the possibility of Satbinder purchasing 112 kg of the cargo, with Mwadia agreeing to provide 31 kg of gold to cover the funds to be paid by Marco in 2022, as well as any additional costs that Satbinder might incur in shipping the entire cargo.
On the same day, Daniel Ogot issued invoices for €162,240 (Ksh23,187,340) and €548,830 (Ksh78,438,783) to Satbinder’s company, Asianic Limited, directing that the amounts be deposited into an escrow account in the name of Mosota Abunga & Associates Advocates, LLP, at Stanbic Bank.
On February 7, 2024, Satbinder issued another invoice for freight costs, totaling €14,112 (Ksh2,016,887). By February 8, 2024, Satbinder had made all necessary payments and Kateti had guaranteed that everything was in order. The 31 kg of gold was deposited in the Mysafe vault at the Village Market.
An elaborate scam: How it unfolded
The next day, the foreign investors collected 31 kg of gold from the vault and went to the customs clearance agent, where the gold was divided into two parts, packed into blue metal boxes and sealed. They were assured that the goods and necessary documents would be handed over to them at the airport, but Oget and Katetti did not show up, leaving the investors in limbo.
With no other options, Marco and Satbinder flew out of Kenya, believing their gold was still safe. While in Italy, Oget contacted them, claiming that the cargo had been misdeclared in weight, leading to the customs department seizing the shipment.
To add insult to injury, Ogot informed the investors that they had been fined 20% of the value of the goods, totalling US$1,562,000 (Kshs201,781,503), and that if they did not pay the fine, they would lose the entire shipment.
Panicked but still hoping to salvage the deal, Satbinder flew back to Kenya and paid €1,438,460 (Ksh205,584,703) through the same escrow account, believing that this would help resolve the customs issues. He was even introduced to a woman named Susan Oketch, who was said to be a customs official. She not only confirmed the authenticity of the fine, but also provided what appeared to be legitimate ownership documents.
Investigations and arrests: How authorities are bringing scammers to justice
However, after returning to the UK on March 20, 2024, Satbinder became increasingly suspicious as the scammers continued to deceive him with fake air waybills and empty promises of delivery. Realising the deal had fallen through, he wrote to the Commissioner of the Kenya Revenue Authority (KRA) to verify the authenticity of the documents.
The matter was then referred to the Directorate of Criminal Investigation (DCI), which launched an in-depth investigation. The findings were shocking: all documents provided to the complainant were forged, the so-called customs officials were imposters, Patvad Trading Co. Ltd did not have a mineral trading license, and the airway bill was also forged. The complainant was defrauded of a total of 2,168,258.91 euros, equivalent to 341,949,292 Kenyan shillings.
The three suspects involved in the case have been arraigned in court. The investigation into the conduct of the attorneys who managed the escrow account has been referred to the Office of the Director of Public Prosecutions (ODPP) for further review and action.
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