The Kenyan agency charged with tracking and freezing criminal proceeds announced that it recently obtained an order authorizing it to freeze bank accounts owned by Nigerian fintech Flutterwave. The agency alleges that Flutterwave is not providing merchant services as claimed and is instead engaging in money laundering activities.
deliberate attempts to conceal the movement of funds
The Asset Recovery Agency (ARA) of Kenya has reportedly recently received a High Court order to freeze bank accounts holding approximately $60 million believed to be laundered money. The companies whose accounts were frozen include Nigerian fintech unicorn Flutterwave, which operated more than 50 bank accounts.
According to areportby The Star, ARA claims that the fintech giant received billions of shillings, which it distributed to various accounts as part of a deliberate effort to obfuscate the movement of funds.
“The investigation established that the bank account operations had suspicious activity that allowed the funds to be received from certain foreign entities which caused the allegations. The funds were then transferred to the relevant accounts as opposed to settlements to merchants,” ARA stated.
The agency further alleged that Flutterwave violated Kenya’s National Payment Systems Act, which prohibits the provision of payment service platforms without the approval of the Kenyan central bank.ARA’s investigator, Isaac Nakitare, said on April 4 reportedly obtained an order to search and inspect Flutterwave’s bank accounts.
No evidence of retail transactions
After receiving the order, Nakitare found nearly $45 million (5.3 billion Kenyan shillings) in the fintech giant’s account at Guaranty Trust Bank and nearly It reportedly discovered that nearly $12 million was in the company’s bank account at Equity Bank. According to the report, Ecobank’s Flutterwave account held millions of dollars in local currency at the time of the inspection.
In addition to Flutterwave, other companies whose accounts were frozen include Elivalat Fintech Limited, Boxtrip Travel and Tours Limited, Bagtrip Travel Limited, Adguru Technology Limited, Hupesi Solutions, and Cruz Ride.
According to ARA, most of the remittances were carried out in tranches of one million shillings or less. This is usually done when the instigators of the remittances seek to avoid detection, ARA said.
The agency also claimed that despite Flutterwave’s claims that it provides merchant services, “there is no evidence of retail transactions where customers paid for goods or services.” It further stated that it found no evidence of “payments to the alleged merchant.”
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