The Central Bank of Kenya (CBK) has declared Nigerian fintech Flutterwave and Californian firm Chipper Cash illegal entities in Kenya.
This comes weeks after the High Court froze financial assets belonging to Flutterwave amounting to Ksh6.2 billion spread in 62 bank accounts.
“Flutterwave is not licenced to operate as a remittance provider or payments service provider in Kenya. They are not licenced to operate and therefore, they should not be operating & I think Chipper Cash, we could also say the same,” said CBK governor Dr Patrick Njoroge.
Chipper Cash is a venture-capital-backed fintech offering free and instant Peer-to-peer Cross-border payments in Africa and Europe. The four-year old company is headquartered in San Francisco, California.
In a case filed by the Assets Recovery Agency (ARA), the firm, alongside four Kenyans are accused of conducting suspicious transactions and failing to comply with financial regulations in Kenya. The money is suspected to b proceeds of card fraud and money laundering.
“That the 1st Respondent’s bank accounts received billions in a suspected scheme of money laundering and the same deposited in different bank accounts in an attempt to conceal or disguise the nature, source, location, disposition or movement of the said funds,” said ARA.
“The transactions were done using cards issued by the same bank, at the same point, on the same day, raising suspicion of card fraud.”
The money is held at several accounts in the Guaranty Trust Bank (GTB), Equity, EcoBank, KCB and Co-operative Bank.
Flutterwave accounts had Sh5.17 billion in 29 accounts at GTB, Equity and Eco Bank in Kenya shillings, US dollars, Euros and Sterling pounds.
Among the amounts frozen include Ksh467.1 million belonging to Boxtrip Travels and Tours, Ksh436 million in Bagtrip Travels Ltd accounts, Ksh1.16 million for Elivalat Fintech Ltd, Hupesi Solutions (Ksh1.6 million), Cruz Ride Auto Ltd (Ksh2.4 million). Simon Karanja Ngige, a director of Cruz Ride Auto Ltd, has Ksh14 million.
Investigations into Flutterwave began several months ago, and authorities obtained warrants to seize the firm’s accounts in April. The provisional seizure permit was granted for 90 days, and the matter will be heard on November 7.
Flutterwave is owned by Olugbenga Agboola, Adeleke Christopher, Iynoluwa Samuel and a company registered in the US, Flutterwave Inc.
Mr Agboola and his partners in Nairobi are accused of conducting about 185 online card payments using the same identification number.
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