Inside the shady world of bold, fake gold fraudsters

But on that night at Cascablanca Club in Kilimani, he went all out, renting the whole premises for the Hennessy cognac-themed party and inviting anyone who mattered in Nairobi’s social circles.

The media were invited and every detail about the cost of the party freely shared.

“The couple’s golden attire, cost a whopping Sh290,000,” entertainment website Buzz Central wrote about the clothes Oduk and his girlfriend Aeedah Bambi wore that night.

Loyal customer

“Just last year, Oduk got his name engraved in the same club as ‘Oduk’s corner’ for being a loyal customer and spending a minimum of Sh100,000 per night.”

The highlight of the night is a conspicuous photo, which immediately hits the eye if you search for Steve Oduk’s name on Google, of him and Bambi washing their hands with champagne as serial fraudsters Jared Otieno and Chris Obure look on.

But when perusing the photos shared that night by entertainment blogs, one starts getting the feeling that it was not just a birthday party.

A criminal enterprise that would in a few years turn Kenya into a hub of transnational fraud was finally becoming bolder and the players going public after making millions of shillings and plotting to mint more.

Everybody needed to acknowledge their power and wealth.

Other than Otieno and Obure, the party was also attended by Ben Kangagi, Kevin Obia, Samir Munyinyi, Sikanda Ismael Saleh alias Salim, Paul Kobia among others. 

At that time, Kobia was Otieno’s aide while Obure, who had in 2011 fallen out with Kobia – his former boss – over proceeds of a deal in fake gold, had just made up with his mentor.

Munyinyi, a Rwandan, was still new in Kenya and trying to find his way around while Kangangi was one of the many hangers-on Oduk drove around with.

Fake gold syndicate

Most of the men at the party would years later form the biggest fake gold syndicate in the country, paving the way for tens of would-be criminals that have created a supposed parallel gangster economy fuelled by millions of shillings believed to have been stolen from mostly from foreign victims.

The criminals are also thought to be dealing in fake money.

The syndicate today includes politicians, celebrities, law enforcers and even judicial officers.

Extravagant parties like Oduk’s were becoming popular among this group of “wealthy” young men.

In 2015, Otieno – and his huge entourage that included politicians, corporate executives and businesspeople – put up an almost obscene display of opulence in his marriage-related ceremonies in Ndhiwa, Meru and Nairobi.

He was then thought to be a wealthy businessman until he was unmasked. 

DR Congo war

Years earlier, fraudsters in Kenya had started a little-known con-game that involved pretending to be in a position to sell gold and making millions of shillings by providing counterfeits. The war in the Democratic Republic of Congo played a big part.

Kobia is mentioned in UN reports as having smuggled gold from the DR Congo from as early as 2011.

A new report by the International Peace Information Service, however, says Kobia was deep in the fake gold trade from 2008.

Joyce Mujuru, the then Zimbabwean vice-president was in 2009 accused of trying to circumvent European Union sanctions against her.

This was after it was discovered that Mujuru’s daughter – Nyasha – had attempted to sell 3,700 kilogrammes of Congolese gold to British company Firstar.

So as not to be discovered, she used Berline Equities Corporate – a Swiss firm belonging to her Spanish husband Pedro Del Campo.

Firstar declined to push through with the deal after it found out that it Mujuru was behind it.

That caused friction between Nyasha and her husband. Afraid of facing the repercussions, Del Campo wrote to the Kenyan Banking Fraud Unit saying Kobia had offered to sell his firm the 3,700 kilos of gold.

“Initially there had been no reason to doubt the reliability of Kobia and his business associates, as they appeared to have the necessary documentation,” Del Campo said.

Everything went according to plan, only for Kobia to disappear with Sh15.2 million that he had been sent for taxes, custom fees, insurance and storage.

Read:Kenyans named in Congo gold scam

After the Zimbabwe saga, Kobia’s next victim and whose deal would ignite the commercialisation of fake gold, was Meranti Holdings Ltd – a South African company. 

On November 1, 2010, Meranti signed a purchase agreement for 300 kilogrammes of gold with Congolese company Groupe Minier de Kisangani (GMK).

Had Meranti officials critically looked at the contract, they would have known they were about to be conned.

“The contract was vague as far as the origin of the gold was concerned. While, at one place in the contract, the origin was identified as DR Congo, Kenya was mentioned as the country of origin at another place,” says IPIS in its report – “Kenya’s role in the trade of gold from eastern DR Congo”.

Escrow accounts

After signing the deal, Caroline Wamba – a partner at GMK – asked Meranti to open an escrow account with a bank in Nairobi which was to handle lifting costs.

Escrow accounts are temporary instruments created by third parties – usually lawyers – to hold money safely for parties engaged in a transaction.

The lawyers hold the money from the buyer and only release it to the seller when the goods are delivered.

In theory, they protect buyers from losing money to fraudsters.

In the trade in fake gold, however, the escrow accounts are merely supposed to make the transaction look genuine.

The lawyers put a disclaimer in order to absolve themselves from any liability.

The money vanishes once it lands in their accounts.

Suspicious that he was not going to get his cut of the Meranti deal, Obure – who was still a novice – spilled the beans to the Directorate of Criminal Investigations (DCI). The DCI immediately arrested Kobia and froze Sh20 million that had been wired to SS Jowhal law firm.

Kobia did not remain in custody for long as he was freed on cash bail.

The publicity the case received made more would-be criminals discover that they could make easy money and remain free.

Kobia was also mentioned in a saga that involved gold from the DR Congo that had supposedly disappeared, prompting a furious President Joseph Kabila to fly to Nairobi and causing a diplomatic row.

‘Wash wash’

This kind of fraud, today popularly  known as “wash wash”, has become so lucrative that hardly a month passes without people being arrested for printing currency, selling fake gold, non-existent government contracts, fictitious loans, and anything that can be sold as air.

DCI detectives on Friday arrested three people from an apartment in Kileleshwa with a money printing machine and counterfeit dollars and Kenyan money.

“Detectives acting on intelligence, launched an operation at Midea Apartment house number 101, therein ambushing Abdulaziz Ibrahim Hassan, 54, Dorcas Ntoya, 34 and 26-year-old Arum Bob Busimbi,” the DCI said.

“Detectives found three copies of a letter purportedly from the Central Bank of Kenya notifying receipt of Sh10 billion, two copies of United Nations invoices, a forged anti-money laundering clearance certificate and a packet of white powder labelled ‘Best Quality Laundry Starch’.”

Yet despite such arrests and arraignments, more and more people continue to join the industry whose proceeds are several times more than armed robbery and the risk of being shot in the process or going to jail.

A glimpse at news reports shows most of the people who get arrested for engaging in the trade in fake gold trade are repeat offenders with pending cases.

Otieno – who is also known by his aliases Jared Kiasa, Jared Smith, Richard Otieno or Jared Mackenzie – was in 2017 charged alongside Salim for conning Lebanese businessman Mohammed Mokhad of Sh4 million by pretending they could sell him 50 kilos of gold.

The two were again arrested and charged with obtaining Sh17 million from Turkish businessman, Mustaq Dawood, the following year.

Otieno is also accused of being part of a band that conned a Brazilian Sh300 million.

Fake dollars

Oduk has an ongoing case too. He is accused of being found with counterfeit dollars and gold bars while Munyinyi, who disappeared last year, had three cases of conning foreigners by pretending he could sell them gold.

It is difficult to understand why a person who is out on cash bail would continue engaging in the crime he was arrested for.

But considering that Kenya has not successfully prosecuted and jailed a “wash wash” accused, one immediately sees the reason.

In most cases, the trials become so lengthy that complainants who have to fly to Kenya every time the matter is heard, get frustrated and give up.

Politician Steve Mbogo was set free by a court in 2018 after Faizah Ahmed whom he was accused of conning Sh22 million failed to show up.

“Instead of turning up to adduce evidence against Mbogo, he just sent an unauthenticated document indicating that he was to take his wife to a hospital in London,” Chief magistrate Roseline Oganyo said before dismissing the case.

Jailed

Kevin Obia, who recently became the first person to be successfully prosecuted for defrauding  Austrian Christian Gallati of Sh13.7 million while pretending to be in a position to sell him seven kilos of gold, was handed a one year sentence with an option of a Sh300,000 fine.

“Any person who by any false pretence, and with intent to defraud, obtains from any other person anything capable of being stolen, or induces any other person to deliver to any person anything capable of being stolen, is guilty of a misdemeanour and is liable to imprisonment for three years,” Section 313 of the Penal Code says. 

Whether it is by design or default, Parliament has never thought of coming up with stricter laws to dissuade people from becoming fraudsters.

Meanwhile, some of the suspected criminals are campaigning for political seats in the 2022 General Election.

Otieno is campaigning for a political seat in Homa Bay County, Allan Chesang who is one of the suspects in a Sh180 million case involving the supply of laptops, wants to be the Trans Nzoia senator.

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