The authorities in Uganda recently arrested Samson Lwanga, one of the directors of a crypto scheme that went down and disappeared with over $2 million from investors. According to a local media report, Dunamiscoin Resource Limited had conned over 10,000 Ugandans of 10 billion Uganda Shillings. Police are hunting down others involved in the scheme. Mr. Lwanga is expected to be put on trial soon.

According to the spokesman for the Ugandan police, the police have opened an inquiry file on the matter and investigations are ongoing. The spokesman said the Lwanga was willing to refund the funds he got from investors. However, Lwanga claims that the Ugandan financial authority had frozen the funds in the bank accounts. The police spokesman said that they would contact the financial watchdog to find out if Lwanga was being truthful. Lwanga also revealed that most of those that were victims of the scheme made monthly deposits of 1 million to 10 million Ugandan shillings.

Like most other crypto scams, Lwanga’s scam promised investors unrealistic returns of up to 40%. Many believed the lies and they invested in the project. The fact that the project was associated with a number of money transfer firms in the country helped to convince investors that the project was genuine.

Initially, most of them received the promised returns. As a result, they on-boarded their friends and family members with some even getting loans, which they would repay from the proceeds of their investment. However, the firms closed down soon after and many were horrified to discover they had fallen for a Ponzi scheme.

The problem of crypto scams is not new in Uganda or Africa. The reason Africa is becoming the favorite target of crypto scammers is due to the lack of regulation. Additionally, a weak enforcement infrastructure makes it lucrative for criminals to set up operations. Combined with limited access to useful information, many Africans have fallen victim to these scams. There is a need to approach a better approach to crypto regulation in the region as well as educating the masses.

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