US Authorities Crack Down on Southern Africa Officials and Businesses for Gold Smuggling

In the early 1990s, a British-Kenyan businessman allegedly embezzled $2.3 billion from Kenya’s public coffers and managed to escape justice.

An investigative commission later discovered that Kamlesh Pattni, the owner of Goldenberg International Limited, allegedly engaged in fraudulent practices by falsely claiming to export gold and diamonds, receiving substantial government subsidies in return for generating foreign exchange.

During that time, Kenya was under scrutiny by international organizations such as the World Bank for alleged misappropriation of funds intended for development and poverty reduction.

The final report of the Goldenberg Commission described Pattni’s operations as “blatantly corrupt,” noting that Kenya lacked significant gold reserves and did not produce diamonds.

“Officials approved payments to Pattni for fictitious exports, benefiting from the deception,” the report stated.

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In 2000, Pattni was charged with fraud but was acquitted after 13 years of legal proceedings marred by missing evidence and witnesses. He has consistently denied any wrongdoing.

“By that time, Pattni had relocated to the United Arab Emirates (UAE),” mentioned Chad Thomas, an independent financial crimes analyst based in South Africa who has delved into major corruption cases across Africa.

“Despite his relocation, Africa remained Pattni’s favored environment due to his connections with corrupt individuals in African politics and business,” Thomas shared with The Epoch Times.

Some of Pattni’s associates were in Zimbabwe, a country that experienced economic collapse in the early 2000s.

The ruling ZANU-PF regime under President Robert Mugabe was accused of misappropriating proceeds from the nation’s rich mineral reserves, including gold, and was involved in seizing white-owned farms and suppressing political opponents.

Zimbabwe’s economic crisis and political persecution led to a mass exodus of people.

Research by economist Saddique Ansari revealed that Zimbabwe underwent severe hyperinflation due to economic mismanagement, with prices doubling on a daily basis by 2008.

“At one point, Zimbabwe’s inflation reached 89.7 sextillion percent annually, rendering the country’s currency nearly worthless.”

Zimbabwean economist Eddie Cross stated that Pattni perceived comparable conditions in the southern African nation that allowed him to engage in fraudulent activities as he had in Kenya.

Cross noted that Zimbabwe’s currency remains devalued, forcing citizens to utilize U.S. dollars and South African rand for transactions.

“In Zimbabwe, the political elite divert public funds instead of investing in essential services and infrastructure development,” he observed.

Cross accused President Emmerson Mnangagwa, Mugabe’s successor, of continuing the corrupt practices of his predecessor.

“All forms of wealth, including mines, have been nationalized, with mineral profits channeled to President Mnangagwa, his allies, and the Chinese, who control some of the mines,” Cross stated.

Similar to the situation in Kenya in the 1990s, Zimbabwe’s failed governance has created ideal conditions for organized crime to thrive, as per the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC).

Pattni, now in his late 60s, was identified by the OFAC as the leader of the southern African “gold mafia,” described as a group posing a threat to the U.S. and global financial systems.

The OFAC asserted that the fraudulent activities have deprived Zimbabwean citizens of benefits from their natural resources, enriching corrupt officials and criminal elements.

The FBI, along with U.S. and U.K. authorities, initiated an extensive investigation into Pattni and his network following media revelations in April 2023.

After leaving Kenya, Pattni formed a relationship with Mugabe and created a similar scheme in Zimbabwe, profiting from the sale of the country’s resources in foreign markets, according to the OFAC.

U.S. authorities determined that Pattni, accompanied by his associates, would falsely inflate cash amounts upon returning to Zimbabwe, receive compensation based on the false figures, and bribe officials to shield their illicit operations.

The OFAC claimed Pattni concealed profits through a global network of front companies.

Pattni and his collaborators are reportedly seeking to expand their operations into other resource-rich nations, exacerbating the threat posed by their illicit network to the U.S. and global financial systems, as per the OFAC’s allegations.

The U.S.-led probe identified Sanjay Keshavji Vaya, a Kenyan national, as Pattni’s key accomplice in Zimbabwean operations.

Furthermore, David Paul Crosby, a British gold trader based in Zimbabwe, was highlighted as a pivotal figure in the alleged smuggling network. He is said to control multiple companies in Kyrgyzstan used for money laundering.

The sanctions freeze the assets held in the U.S. by those listed by OFAC and prohibit them from engaging in any business transactions in America. U.S. citizens are also forbidden from carrying out any dealings with the sanctioned individuals and entities.

When approached in Dubai by The Epoch Times for comments on his activities in Zimbabwe, Pattni declined to respond. He also refrained from discussing the U.S. sanctions imposed on him and his associates.

Regarding Pattni’s business dealings in Zimbabwe, George Charamba, Mnangagwa’s spokesperson, remarked to The Epoch Times: “The American sanctions are dismissed with the contempt they deserve. The president’s business engagements are deemed private.”

He referred The Epoch Times to a statement made by Monica Mutsvangwa, Zimbabwe’s information minister, on April 4, 2023, addressing the release of Al Jazeera’s documentary series “Gold Mafia,” which explored gold and money laundering activities in southern Africa.

During the press conference, Mutsvangwa pledged that the government would investigate allegations of a gold smuggling network operating in Zimbabwe.

“Any individual found guilty of corruption, fraud, or criminal activities will face the full extent of the law,” she announced on state television.

“The government reaffirms its commitment to upholding both local and international laws governing financial transactions, gold trade, and other valuable minerals in the country.”

Cross noted that no prosecutions related to gold smuggling in Zimbabwe have emerged following Mutsvangwa’s public statement.

“The supposed investigation has not yielded any results,” the Zimbabwean economist remarked.