By Spy Uganda
American investor Sergey Chistov and his Tanzanian business partner James Emilian Banzi have petitioned Uganda’s Law Council, seeking disciplinary action against prominent lawyer Paul Wanyoto. Wanyoto, who also chairs the Mbale City Land Board, stands accused of professional misconduct, fraud, and abuse of fiduciary duty in a series of business dealings involving the gold mining sector.
In a formal complaint submitted to the Law Council in Kampala, Chistov and Banzi allege that Wanyoto and another corporate lawyer, identified as DG, misled them into investing hundreds of thousands of dollars in a Ugandan mining venture—promises that allegedly never materialized. DG, a lawyer at a reputable Kampala firm based in the Nakasero area, introduced the investors to Wanyoto in February 2023, describing him as Uganda’s top legal expert in mineral transactions.
Chistov and Banzi, established players in Tanzania’s mineral sector, sought to expand their operations into Uganda. Following legal advice, they incorporated Igolide Uganda Ltd, with Chistov as Managing Director and majority shareholder. Wanyoto and DG were included as local shareholders to support the business setup and operations.
The investors allege that Wanyoto solicited approximately $10,000 for company incorporation, $50,000 for a “facilitation fee” to secure a gold exploration license from the Ministry of Energy and Minerals, and another $40,000 to establish a joint venture with artisanal miners at Kisita Gold Mine in Kasanda District. Despite making these payments, Chistov claims that no license was issued and the promised joint venture never materialized.
Chistov also reports losing $250,000 in late 2023 in a fraudulent gold transaction involving a warehouse in Namanve. Though shown several kilograms of gold, he says he was never allowed to take possession of the shipment. An additional $2,000 was allegedly paid for police protection to transport the gold to an office in Bukoto—another transaction that ended without delivery.
The American investor accuses Wanyoto and DG of abusing their position as signatories on Igolide Uganda’s Bank of Africa account. According to Chistov, the lawyers withdrew over $367,000 between August 2023 and January 2024 for personal use, as detailed in a Sunday Monitor exposé.
The complaint to the Law Council outlines further grievances, including the alleged misappropriation of $40,000 meant to secure a Memorandum of Understanding with artisanal miners—an MoU that, to date, has not been produced. The investors demand that the Law Council hold Wanyoto and DG accountable for professional negligence, breach of fiduciary duty, and improper conduct, and recommend that they be barred from legal practice.
Chistov and Banzi have also written to Uganda’s State House Anti-Corruption Unit (SHACU), alleging that Wanyoto has used his influence within the Immigration Department to have Chistov’s visa, and those of his colleagues, cancelled in a bid to assert control over the company. Chistov further claims that Wanyoto falsely accused him and others of homosexuality, attempting to prompt criminal investigations and force the foreign investors to flee Uganda.
Mariam Natasha Oduka, spokesperson for SHACU, confirmed that investigations into the matter are nearly complete. “The suspects will be arraigned in court soon,” she stated, adding that the Director of Public Prosecutions is preparing to proceed with charges against Wanyoto and DG.
Separately, Chistov has petitioned the Attorney General to review a controversial May 3, 2024 order issued by Chief Magistrate Ronald Kayizzi. The order protects Wanyoto from arrest by SHACU on the grounds that he is a whistleblower in an alleged homosexuality case at Igolide Uganda Ltd—an assertion Chistov strongly disputes.
Chistov also accuses Wanyoto of manipulating company email and tax identification details, effectively locking him out of the Uganda Revenue Authority (URA) portal and obstructing critical import clearances for the company. As a result, he claims to have suffered repeated delays and losses, particularly when dealing with perishable equipment shipped into Uganda.
The matter is now under review by multiple Ugandan authorities, including the Law Council, SHACU, and the Office of the Attorney General.
Implications For Uganda’s Mining Sector
These cases underscore the challenges faced by foreign investors in Uganda’s mining sector, particularly concerning legal representation and regulatory oversight. The involvement of legal professionals in such fraudulent activities not only damages the reputation of the legal profession but also deters potential investors from entering the market.
The Law Council’s response to these petitions will be closely watched, as it will set a precedent for handling allegations of legal misconduct in the mining sector. Additionally, the outcomes of ongoing investigations into these cases will likely influence future foreign investment in Uganda’s mining industry.
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