Nigerian fintech startup, FlutterWave, has denied the $59 million money laundering claims levelled against it in Kenya after the country’s High Court froze its bank accounts.
The court froze about 52 multi-currency accounts in three banks which hold more than $40 million. The funds cannot be moved following the order which is based on an application by the Assets Recovery Agency (ARA) under anti-money laundering rules.
The ARA told the court that the accounts were used as channels for money laundering while disguising as accounts providing merchant services.
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“Investigations established that the bank accounts operations had suspicious activities where funds could be received from specific foreign entities which raised suspicion. The funds were then transferred to related accounts as opposed to settlement to merchants,” the ARA stated.
The ARA also stated that Flutterwave provided a payment service platform without authorisation from the Kenyan Central Bank, as required by section 12 of Kenya’s National Payment System Act.
According to the court, the orders “shall subsist for a period of 90 days” and for that period, Flutterwave is prohibited from transacting, withdrawing or transferring the funds therein.
Responding to the allegations in a statement, Flutterwave denied all the claims, reiterating that it maintains the highest regulatory standards in its operations and that the claims are part of a disinformation campaign.
“Through our financial institution partners, we collect and pay on behalf of merchants and corporate entities. In the process, we earn our fees through a transaction charge, records of which are available and can be verified. As a business, we hold corporate funds to support our operations and provide services to all our customers.
“By facilitating payments for the biggest organizations in the world and everyday businesses, we process significantly large volumes of money and contribute to growing the economy in Kenya, and the rest of Africa.
“We are a financial technology company that maintains the highest regulatory standards in our operations. Our Anti-money laundering practices and operations are regularly audited by one of the big four firms. We remain proactive in our engagements with regulatory bodies to continue to stay compliant.
“Flutterwave has a responsibility to ensure the integrity of the ecosystem, and we pledge our commitment to continue to work with all stakeholders to uphold this. We are working to figure out the motive behind the publication, and have the records straightened,” the statement read.
Flutterwave, which is Africa’s largest startup with a valuation of over $3 billion dollars, has suffered a lot of negatives this year.
Back in April, THE WHISTLER reported how a former member of staff at the company, Clara Wanjiku, accused its CEO, Olugbenga Agboola, of bullying, harassment and tarnishing her image.
Following that, a report by West Africa Weekly surfaced detailing how the CEO allegedly abused his position as Access Bank’s head of digital factory and innovation to profit Flutterwave while hiding his concurrent involvement in both entities from investors and regulators.
The exposé which was the subject of various Twitter Space debates garnered more than 70,000 tweets according to Trendinalia Nigeria.