Uganda’s anti-corruption court sentences international gold scammers

Uganda’s anti-corruption court has been hearing an incredible story about a gang of scammers, headed by Lawrence Lual Malong of South Sudan, a high-living playboy, sometimes photographed lying in pools of US dollars and wearing shoes, clothes and watches worth a fortune. Malong and two co-accused were convicted of fraud in that they extracted huge sums from two Ethiopian businessmen, living in South Africa, for gold that did not exist. Malong has been named in a variety of articles and reports including one from movie star and activist George Clooney’s anti-corruption outfit, The Sentry. A 2016 report by The Sentry, “War Crimes Shouldn’t Pay”, says Malong junior creates the impression of having ‘immense wealth’, and as benefitting from close family connections to the enormously rich and powerful in South Sudan.

Read judgment

Read report in The Sentry

 

Uganda’s anti-corruption court has never seen anything like it. The three accused, one of whom has an international profile for high-living, standing in the dock, having to answer for their role in an incredible scam, spread across many parts of the world.

Early on in his decision, the presiding judge, Lawrence Gidudu, described the story leading to the trial of the three men on fraud and related charges, as like a movie. He was right. Not only was there an almost unbelievable plot to lure the unlucky victims, but the drama took place across many countries, starting in South Africa and then, through various African states, to Dubai and Hong Kong.

Conned

At its heart is the story of a man who fell captive to the idea of owning gold and who was conned into paying more and more for it, reluctant to accept that the ‘sellers’ were conning him.

On the opposite, dark side, of the movie plot, were a group of men and women, three of whom were arrested and have been standing trial. The remainder are ‘still at large’. The group of fraudsters played various roles in the scheme, one holding himself out as a pious man of God, for example, another the son of an army general from DRC who owned the gold, a third took the part of an officer from Kenya’s revenue authority, while another posed as an officer from Interpol.

It all began in South Africa with two Ethiopian businessmen based there, W G Dessie and his friend Belay Engda Abebe, both of whom gave evidence for the prosecution. One of the accused, Lawrence Lual Malong Yor Junior, struck up an online friendship with Abebe, and Malong invited Abebe to travel with him to South Sudan to explore investment opportunities. Not convinced by what he saw, Abebe returned to SA, but a friendship between the two men continued, at least on social media.

Loser

Malong then ‘introduced the gold business’ to Abebe who, in turn, interested his friend Dessie, ultimately the major loser in the scam that was taking shape.  

The two set off for Uganda where they met Malong who introduced them to some of the rest of the scammer team. Dessie was willing to buy one kilogram of gold ‘as a trial’, but that just plugged him into the scheme. The fraudsters kept pushing him to buy more and more gold, on the grounds that the seller – allegedly an army general from DRC – refused to part with small quantities or that the Ugandan authorities refused to clear less than a minimum of 150 kgs. Each time Dessie asked for a refund he was rejected on the grounds that the money had been spent ‘on logistics’ and that the deal was ‘ripe’ and it would be imprudent to pull out at that stage.

Finally, in February 2018, when Dessie was not given the gold for which he had paid, ‘the curtain fell’, as the judge put it. Now Malong began to cast himself as another innocent victim. Then the second accused, Mike Lota, sent Dessie videos of Malong lying on piles of US dollars and claimed that it was Malong who had taken all the money.

Hotel expenses

Later, explaining the videos and all the US dollars in his possession, Malong claimed he had received the money ‘from Jesus’, a claim the court strongly rejected.

In all, Dessie claimed he had lost USD1.9m, most of it to the accused, but also in what he spent on air travel and hotel expenses back and forth between SA, Uganda, Kenya, Dubai and Hong Kong, ‘chasing gold that never was’, as the court put it.

The three accused pleaded not guilty and put up a most complicated story in their defence, a version that the court rejected saying that they had made no ‘credible challenge’ to the prosecution evidence.

‘Gullible’

The judge said the two Ethiopians were ‘gullible’ and trusted other people too much. However, he added, ‘the script from which the tricks were being sourced was well written.’ The scammers had also constantly produced apparently valid documentation for the gold to be exported from Uganda and other countries, but the judge said he was satisfied that witnesses called in the case had proved the documents were false.

Ultimately, the three accused were found guilty on seven of the 10 counts with which they were originally charged; in relation to the money that Dessie spent on hotels and travel they were acquitted.

The day after conviction, sentence was passed on the three men. Malong was given six years. His co-accused Mike Lota is to spend four years in jail, while the third accused, Ugandan Gavana Zhikusoka aka James Byaruhanga, was given five years.

Camouflage

Malong has a clear presence on social media including LinkedIn, where he has two entries. In one he lists himself as based in Cape Town, and as being the CEO and founder of South Sudan International Trade and Investment Holdings. He also lists an education connection to the University of Johannesburg, 2009 - 2012. This listing includes photographs of himself wearing camouflage and boots.

The second listing shows him in trademark pose, wearing an expensive suit in the business class of an airplane, but it lists the same education background and CEO position. He further notes that he is ‘step son to General Paul Malong, South Sudan Army chief’.

Malong is also mentioned in a report by The Sentry, the anti-corruption foundation of movie star George Clooney. In a 2016 report called, ‘War crimes shouldn’t pay: Stopping the looting and destruction in South Sudan’, The Sentry notes the link between ‘systemic corruption and violent conflict’ in the area and focuses on the key figures identified by the UN and the African Union as having ‘command authority’ over military operations that resulted in widespread human rights crimes.

‘Immense wealth’

The report includes a section on ‘The Young Tycoon’, as Malong likes to be called. Malong is described as being based in Johannesburg, but having access ‘to the most senior level of government in South Sudan’. The Sentry also mentions the ‘impression of immense wealth’ created by Malong via his social media presence.

In an interview with The Sentry he said that the ‘foreign investors’ with whom he does business pay for his first-class plane tickets. He was also ‘open about his involvement in the mining sector, stating that he is involved in companies that hold oil, diamond and gold concessions.’

  • ‘A matter of justice’, Legalbrief, 7 September 2021