Flutterwave denies money laundering allegations in Kenya

Fintech company Flutterwave has denied allegations of money laundering levelled against the Kenya arm of the company.

The company denied the allegations in a statement released on Monday.

Kenyan newspaper, The Star, had reported that the country’s high court had frozen 56 bank accounts, including Flutterwave’s, holding a whopping Sh7 billion ($59 million) suspected to have been laundered by foreign nationals.

According to The Star, Flutterwave company operated 29 bank accounts with Guaranty Trust Bank, 17 with Equity Bank and 6 with Ecobank.

The Kenya Assets Recovery Agency said the company’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,” ARA said.

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

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.

Responding however, Flutterwave said that the company was a target of false media reports and misrepresentations.

“Claims of financial improprieties involving the company in Kenya are entirely false and are being circulated as part of a disinformation campaign. Flutterwave has been a target of deliberate false media reports and misrepresentations.

“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,” it said.

The company also stated its role as a payment merchant in Kenya, noting that its Anti-Money Laundering practices were always audited by an unnamed reputable firm and it complied with regulatory bodies.

“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 concluded.