A Kenyan High Court has frozen another Sh400.6 million ($3.3 million) in three separate bank accounts and some 19 Safaricom M-Pesa pay bill numbers belonging to Nigerian fintech company, Flutterwave following allegations of card fraud and money laundering by the country’s anti-corruption agency.
On August 25, the court allowed the Asset Recovery Agency’s (ARA) request to restrict the fintech’s attempts to transfer or withdraw the millions in the three bank accounts—two in UBA and one in Access Bank—as well as the 19 Safaricom M-Pesa paybill numbers.
The amounts frozen include Sh110 million in a UBA bank account, another US $ 556,622 (Sh66.7 million), Sh29.1 million in Access Bank and Sh68 million, Sh112 million and Sh14.5 million in a total of 19 Safaricom Paybill numbers.
The ARA’s accusations against the company frequently mention the business’s involvement in card fraud and money laundering. A similar court order to freeze Sh6.2 billion ($59.2 million) dispersed over 62 bank accounts belonging to Flutterwave and seven other firms were issued to the ARA in July as reported.
Justice Grace Nzioka barred the companies from withdrawing, transferring or dealing with the money, pending ARA’s probe.
“A preservation order be and is hereby issued prohibiting 1st respondent or his agents or representative from transacting, withdrawing, transferring, using any other dealings in respect to the money held in the account,”
ruled by Justice Grace Nzioka
Related story: A timeline of the recent travails of Flutterwave, ChipperCash others in Kenya
Flutterwave’s history of accusations
The travails of Flutterwave in Kenya started about two months ago when Kenyan news publication platform, the Star Kenya reported that the Asset Recovery Agency (ARA) told a Kenyan High court that the accounts for seven targeted companies were used as conduits for money laundering in the guise of providing merchant services.
The accounts that were frozen had sums in USD, British Pound Sterling, EURO and Kenya shillings
The High court in Kenya then proceeded to freeze 56 bank accounts holding a whopping Sh7 billion suspected to have been laundered by foreign nationals.
The companies listed were Flutterwave payment technology limited, Boxtrip travel and tours limited, Bagtrip travel limited, Elivalat fintech limited, Adguru technology limited, Hupesi solutions, Cruz ride auto limited and one Simon Ngige.
Following the report that the company’s accounts had been frozen, the company responded. In a statement, it claimed that the “financial improprieties involving the company in Kenya were entirely false, and had the records to verify this.”
Since then, the Central Bank of Kenya (CBK) has also sent out a circular to all financial institutions that are in partnership with Flutterwave to cease working with the fintech company. This Governor of the CBK, Patrick Njoroge said during a Monetary Policy Committee (MPC) meeting that Flutterwave is not licenced to operate in Kenya.
In the same month, a Kenyan court froze monies belonging to Flutterwave in accounts holding Ksh45 million ($381,000) as well as accounts belonging to two Nigerian fintech companies, Korapay and Kandon. These were frozen following an application by the ARA for allegedly siphoning Ksh6 billion ($51 million) into the country.
These companies, the ARA alleged, are linked to Flutterwave and are allegedly involved in an international ring of fraudsters who move illicit money through Kenyan banks. Korapay has since denied the allegations.
In this most recent case, the ARA documents showed that debits totalling Sh136 million from one of Flutterwave’s UBA bank accounts included chargebacks, reversals, and reimbursements that suggested they were being used for card fraud. The agency added that the Ksh231 million conversion of dollars into shillings in one account indicated “a plan of layering and intermingling.”
Flutterwave is yet to respond to the allegations as the time of reporting.
Read also: Flutterwave discontinues Barter virtual dollar card “for an extended period of time”
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