Kampala, Uganda: Government has issued a stern warning to gold dealers to be on high alert against scammers who are increasingly fleecing traders under the guise of buying or selling gold.
David Ssebaggala, a senior inspector of mines at the Ministry of Energy and Mineral Development, told journalists on Monday that many fraudulent deals presented to dealers are “too good to be true” and often end up as outright scams.
“In most cases, it is a case of who has outsmarted who. Some of these people who pretend to be gold buyers come here to con. No genuine trader of gold is going to ask you for a fraction of the entire cost of the deal to give you the gold,” Ssebaggala said.
He warned traders not to be deceived by attractive deals, saying scammers are often highly skilled and sometimes hold valid licences, which they use to mislead unsuspecting investors.
“If a transaction in trade of gold is too good to be true, it is a scam. Even if you tell people they are going to be cheated, they don’t listen. Some of these people have licences, but they will still con you. Endeavour to do due diligence with companies you are trying to deal with,” he added.
The official further cautioned foreign investors against assuming Ugandans are naïve in the mineral trade. “When you come with a perception that people here are dumber than you, they will outsmart you. Uganda is not a paradise where you are going to come for minerals and take them for free,” he noted.
The Commandant of the Police Mineral Protection Unit, Julius Cease Tusingwire, revealed that scammers use fake documents, stolen mine photos, and fraudulent premises to dupe buyers. He said fraudsters lure victims with temptingly low prices, well below international rates, before disappearing with their money.
“While a kilo of gold goes for between $100,000 and $120,000, the scammers will tell you they have a kilo at $40,000. They promise to process documents and ship the gold, but once you send them money, you wait until gold never reaches,” Tusingwire said.
He disclosed that since January, police have conducted several operations in Kampala suburbs including Muyenga, Buziga, and Kansanga, shutting down scam premises and arresting several suspects. He, however, noted that offences are resurfacing, prompting the resumption of countrywide crackdowns.
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