KAMPALA, Uganda — An American investor’s pursuit of wealth in Uganda’s mining sector has turned into financial ruin, highlighting what he describes as systemic corruption, according to a report by the Ugandan investigative paper, The Observer.
Christov Sergeyy, a former Tanzanian gold dealer, claims he lost 2.2 billion Ugandan shillings (about $590,000) in a year due to exploitation that he says undermines Uganda’s legal and regulatory frameworks.
Sergeyy founded Igolide, a company intended to establish a gold processing plant, and invested 40 million shillings (about $10,700) for land. His optimism, however, faded as he says he became a victim of a sophisticated scheme involving influential individuals and two lawyers, Daniel Gatunga and Paul Wanyoto.
“Every week, I read about lawyers being tried for defrauding investors,” Sergeyy was quoted as saying by The Observer. “I thought I could trust them, but it turned out to be a gold curse.”
Sergeyy alleges the fraud began when he sought legal advice to navigate mining regulations. After being cheated by a gold speculator, he consulted Gatunga, who recommended Wanyoto. Sergeyy claims Gatunga aimed to incorporate Igolide while allowing Wanyoto to pursue fraud recovery.
Gatunga allegedly promised to expedite licensing through non-existent connections to military officials. Although Igolide was incorporated, Sergeyy was never a signatory on the company’s account, as the lawyers claimed it was illegal for a foreigner to hold that position.
Sergeyy lost nearly 2.2 billion shillings intended for mining operations and land purchases. When he questioned suspicious transactions, he claims the lawyers became evasive and accused him of homosexuality — a serious allegation in Uganda that could lead to deportation — which he believes was an attempt to silence him.
His alleged losses included 40 million shillings for land, $50,000 as a “facilitation fee” for a gold exploration license, $250,000 in a fraudulent gold transaction, and $367,000 misappropriated from Igolide Uganda’s bank account.
The Observer highlighted flaws within Uganda’s judiciary, Law Society, and Law Council, noting slow progress despite Sergeyy filing a lawsuit and seeking disciplinary action against the lawyers. The Law Council, responsible for overseeing legal professionals, has faced criticism for inaction.
Complaints about Gatunga’s misconduct remain unanswered, The Observer reported. Sergeyy and his colleague, Emilian Manzi, filed a complaint against the lawyers for negligence on Dec. 18, 2024. Paul Wanyoto has reportedly used his influence to obtain restraining orders against arrest, claiming whistleblower status in an unrelated case. However, a letter from Kampala Metropolitan Police Headquarters dated June 6, 2024, indicates no record of Wanyoto reporting any case against Sergeyy.
Sergeyy has since established a processing plant in Kisita, Mubende, collaborating with artisanal miners to promote sustainable gold processing practices.
“I don’t want other investors to go through what I’ve experienced,” he told The Observer. “The legal profession in Uganda is in dire need of reform.”
The involvement of the State House Anti-Corruption Unit has brought cautious hope. A report detailing the alleged fraudulent activities of Wanyoto and Gatunga is set for submission to the director of Public Prosecutions, though skepticism about the outcomes remains. The Observer noted that Sergeyy’s story reflects broader challenges for foreign investors in Uganda’s mineral sector, with allegations against Wanyoto and his associates revealing a troubling pattern of lawyers exploiting their positions.
