Flutterwave accused of money laundering in Kenya; accounts frozen

The Asset Recovery Agency (ARA) in Kenya has issued orders to a high court to freeze 56 accounts holding Sh7 billion ($59.2 million) belonging to foreign nationals and entities including Flutterwave, a Nigerian fintech company that provides a payment infrastructure for global merchants and payment service providers across the continent. 

The accounts affected are 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.

The accounts, in USD, British Pound Sterling, EURO and Kenya shillings, were suspected to be used as conduits for money laundering in the guise of providing merchant services.

According to court documents, Flutterwave operated 29 bank accounts with Guaranty Trust Bank, 17 with Equity Bank and 6 with Ecobank. The Agency says Flutterwave’s account received billions of shillings and the same was deposited in different bank accounts in an attempt to conceal the nature, source or movement of the funds.

“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,” said the Agency.

Isaac Nakitare, an investigator with ARA, in an affidavit, says the agency obtained orders on April 4 this year to search and inspect the accounts

According to newspaper reports, Nakitare says by the time he obtained the orders, the accounts at Guaranty Trust bank belonging to Flutterwave had a balance of Sh5.3 billion, Sh1.4 billion at Equity bank and other millions at  Ecobank.

Some of the funds he said were transferred into fixed deposit accounts.

The Agency further established that Flutterwave was concealing the nature of its business by allegedly providing a payment service platform without authorization from the central bank of Kenya as required by section 12 of the national payment system act.

The accounts he said were used as conduits for money laundering in the guise of providing merchant services.

“If indeed the Flutterwave was providing merchant services, there was no evidence of retail transactions from customers paying for goods and services. Further, there is no evidence of settlements to the alleged merchants,” he said.

The agency also presented evidence on transactions between Flutterwave and the other companies listed in the court order.

The orders granted by the court will be in force for a period of 90 days.