Two Kenyan citizens living in California, USA have been sued by American investors for allegedly defrauding them of Sh219.3 million.
In the lawsuit filed in the United States District Court in the District of Utah, the two Mathew and Brooke Shaw claim they were misled into believing that the money would be used for geological surveys in the Democratic Republic of Congo (DRC ) to build infrastructures for a battery manufacturing plant.
The Shaws argue that Julius and Kaila Mwale disguised themselves as billionaires who had a vision of “changing the world and solving world hunger”.
“The Mwales told the Shaws that the Mwales typically relied on their own assets for investment opportunities of this kind, but that they were “allowing” a close circle of family and friends, including the Shaws, to contribute upwards of $50 million as outside investors in the project,” read court documents.
The court in Utah heard that Julius Mwale had assured the Shaws that their financial contribution of $1.7million would be treated as a loan with a guaranteed 20 percent annual return.
Julius Mwale also said their investment would be rolled into Tumaz and Tumaz, Julius’ parent company which is worth $60 billion with the potential to yield upto ten times the original amount.
The couple however claim, upon visiting Kenya to see the results of their massive investments, they realized they had been misled into investing in a fraudulent investment scheme.
According to the Shaws, Julius and Kaila made numerous false representations to lure them into funding the projects.
The Mwales allegedly made claims that local farmers in the vicinity of their African projects had become millionaires thanks to rising land value.
They also boasted of building a luxury golf course and rental homes on land donated by the farmers, supposedly providing the local community with lucrative income streams.
However, the Shaws alleged the golf course is far from complete, and the promised income opportunities for farmers have not materialized.
“Julius also showed the Shaws the rental homes he claimed to have built to generate revenue for the farmers. The homes were little more than vacant 10×10 concrete boxes with no facilities, “ said the Shaws.
The Mwale’s claimed they had constructed what they described as the world’s largest and most advanced hospital, featuring 5,000 bed, state of the art technology and advanced cancer treatment, which the Shaws alleged was incomplete, with only a single wing operational which serves as a basic clinic, primarily treating local children for malaria, and lacks the advanced facilities that were promised.
The Mwales also said they had a team, including Derek William, whom they said was a rocket scientist recruited from Boeing and the owner of KE international.
They also claimed that Christine Allyn was a former personal assistant to Kofi Annan, the former United Nations Secretary-General
“Derek William, whose actual name is Derek William Knox and Christine Allyn whose actual name is Allyn knox are actually Kaila’s siblings,” said the Shaws.
Following the Shaws’ request to withdraw their funds in September 2022, they were told that repayment would be delayed for a 60 to 90 days “due diligence” period.
This period was later extended to 120 business days, with a new repayment deadline set for March 5, 2023 which was never honoured.
Through a loan modification agreement between the Shaws and Kaila, Kaila committed to repaying the $1.7 million in four installment over a seven-month period.
Kaila however did not pay the final installment of $850,000 despite the Shaws agreeing to an extension until January 24, 2024 with an additional $20,000.
The Shaws now want to be compensated for the “benefit they conferred upon the Mwales by the return of atleast $870,000”.
“The circumstances of this case are such that it would be unjust for the Mwales to retain the benefit conveyed by the shaws without paying for the benefits,” they say.
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