Guardian: Obama Appointee Linked to Deal with Warlord

February 6, 2012

An Obama-appointed U.S. trade adviser orchestrated an illegal multi-million deal to buy gold from a Congolese warlord, a U.N. report claims.

Kase Lawal, a Nigerian-born U.S. oil tycoon who was appointed to the U.S. advisory committee for trade and policy negotiations in 2010, transferred millions of dollars to rebel leader Bosco Ntaganda between December 2010 and February 2011 in exchange for gold, according to a report by the UN's Group of Experts on the Democratic Republic of the Congo.

Ntaganda has been wanted by the International Criminal Court since 2006 for allegedly recruiting child soldiers and presiding over mass rapes and murders of civilians. If the allegations against Lawal are true, he would be guilty of breaking UN resolutions banning individuals or organizations from financing illegal armed groups in the war-torn eastern DRC.

From The Guardian:

According to the report, while Lawal was initially under the impression that he was buying gold from an owner in Kenya, he did not abort the deal when he learned Ntaganda was the true owner.

Instead, the UN report says Lawal merely "appeared relieved to finally be engaging directly with the true owner of the gold".

The report says Lawal financed the deal while Edward Carlos St Mary, a Houston businessman and friend of Lawal's, carried out the transaction in DRC. The deal was proposed to the two men by Dikembe Mutombo, a Congolese former NBA player with the Houston Rockets, and three of his relatives.

Despite paying, Lawal never received the gold. St Mary flew to Goma in DRC to finish the deal in a Camac-leased jet, but the passengers were arrested by Congolese presidential security officers as they tried to take off with the gold in February 2011.

St Mary and two Camac employees were charged with money-laundering and illegal transport of a banned material, because at this time the Congolese government had banned mining of gold, tin and coltan in the provinces where the minerals trade was affected by illegal armed groups. The three men were released in late March after Camac's Kinshasa representative paid $3m (£1.9m) in fines.

Substantial sums of money were involved from the start. The report says Lawal told St Mary he had lost "$30m as a result of the whole ordeal, including transport fees, fines, bribes" and the payments for the gold.

Jason Stearns, a former Group of Experts co-ordinator, said: "This is a fine example of the rank disregard of international law by major international companies and businessmen."