An additional KES 400.6 M (USD 3.3 M) allegedly tied to money laundering and card fraud has been blocked by the Kenya High Court in three bank accounts and 19 Safaricom M-Pesa paybill numbers that belonged to the Nigerian startup, Flutterwave.
Following an application by the Assets Recovery Agency (ARA) to halt the transfer or withdrawal while a petition to have the money forfeited to the government is being filed, the millions held in 19 M-Pesa paybills, one account at Access Bank and two accounts at UBA were all frozen.
The funds frozen include KES 110 M (USD 916 K) in a UBA account, another KES 66.7 M (USD 556.6 K), KES 29.1 M (USD 242 K) in an Access Bank account, and KES 68 M (USD 17 K), KES 112 M (USD 933 K), and KES 14.5 M (USD 120 K) across 19 Safaricom Paybill numbers.
Until the ARA investigation is complete, Justice Grace Nzioka prohibited the corporations from withdrawing, transferring, or dealing with the money.
“A preservation order be and is hereby issued prohibiting first respondent or his agents or representative from transacting, withdrawing, transferring, using any other dealings in respect to the money held in the account,” ruled Justice Nzioka.
In court documents, the agency said that the bank accounts had received millions of shillings from an unknown source that was possibly obtained through card fraud or money laundering.
The freezing order has come just two months after more than KES 6.2 B (USD 51.6 M) was confiscated in 62 bank accounts belonging to Flutterwave, and four Kenyans were also held on identical charges.
The previous case involved transactions made with cards issued by the same bank, at the same time, on the same day, raising the possibility of card fraud.
In the most recent case, ARA stated that debits totalling KES 136 M (USD 1.13 M), including chargebacks, reversals, and refunds, were linked to suspicious of card transactions suggestive of card fraud. Another account was alleged to have been used in suspicious conversions of dollars to shillings in a manner that points to layering and intermingling activities.
In April, after Kenya’s ARA froze the bank accounts of Nigeria-led RemX for fraud, Kenyan media reported that a powerful politician was at the centre of the dealings, including that of Flutterwave. They declined to name the politician for legal reasons but there’s some speculation that the trail goes all the way up.
In the face of these issues and earlier troubles that put the company’s leadership under the microscope for a raft of questionable practices, Flutterwave continues to plot its next big move. Unfazed by the allegations, Africa’s most valuable tech unicorn seeks a Nasdaq IPO in the near future.