Flutterwave CEO in Nairobi for Seized Billions, CBK Permit

Olugbenga Agboola, the chief executive officer and co-founder of the Nigerian payments company Flutterwave, arrived in Kenya this week in an effort to unfreeze Sh6.6 billion and lift a Central Bank of Kenya (CBK) embargo on the business.

The start-activities up’s in Kenya, which was the second-largest market after Nigeria, were shut down in less than a year after the High Court frozen Sh6.6 billion due to concerns about money laundering and the CBK ordered banks to terminate ties with the company.

Mr. Agboola travelled to Nairobi to speak with the company’s local staff and request a meeting with the CBK, which in December requested that his company create a new license operation.

Flutter wave’s accounts were frozen in accordance with local anti-money laundering regulations, according to the CBK, which claimed it lacked a license at the time and ordered local banks to stop doing business with it.

The High Court’s decision on Thursday to deny a request from more than 2,000 Nigerians seeking a portion of the frozen Sh6.6 billion occurred at the same time as Mr. Agboola’s visit.

In a petition, Nigerians claimed that a sports betting company that used Flutterwave to handle the payments had defrauded them of billions of shillings.

The lawsuit was dismissed, giving Flutterwave another success after Kenya’s Assets Recovery Agency (ARA) withdrew from the case in December after it had obtained orders freezing billions in 29 accounts at GTB, Equity, and Ecobank denominated in Kenya shillings, US dollars, euros, and British pounds.

The dismissal of the lawsuit and ARA’s withdrawal have made it easier for Flutterwave to obtain the Sh6.5 billion and shed its reputation as a money launderer.

“CBK invited us in December to reapply for a money remittance and payments service provider licenses,” Mr Agboola said in an interview with the Business Daily in Nairobi.

“Kenya is the bedrock of mobile money. We have seen the gap and have raised capital to invest here. Without Nairobi, building a global mobile money payments system is not possible,” he added from Flutter wave’s Kenya base in Nairobi’s Riverside Drive.

According to Flutterwave, the 37-year-journey old to Kenya was part of his “regular course of work,” which the programmer completes once every three months.

The typically reticent Mr. Agboola, or GB as he is affectionately known in the tech industry, travelled to Kenya with Riva Levison, a renowned US lobbyist and PR pro.

solving problems

Ms. Levison takes satisfaction in being a political strategist who helps customers in African governments with problems ranging from political risk to electoral strategy. She has worked on projects for past presidents like Joyce Banda and Ellen Johnson Sirleaf of Liberia (Malawi).

Thanks to a personal investment binge in other African businesses in recent months, Mr. Agboola’s name has grown beyond his leadership at Flutterwave.

After learning that the company had Sh184.9 billion in 62 bank accounts spread across five banks in four years without the knowledge of or authorization from the CBK, he travelled to Nairobi a few days later.

It was one of three Nigerian fintech companies that were the focus of a difficult money laundering investigation in Kenya.

ARA looked into the three, including RemX and Kandon Technologies, due to concerns about card fraud and money laundering.

Claims of financial irregularities in Kenya were deemed “completely unfounded” by Flutterwave.

The company said that in order to maintain compliance, audits of its business activities were conducted on a regular basis.

“Innovation in most cases is normally ahead of regulations and compliance is a journey that takes time. What we are doing now is bring in qualified global experts to strengthen our processes,” Mr Agboola said.

The Lagos-based business, which was formed in 2016, is currently the continent’s largest payments start-up. In 35 African countries, it has handled more than 400 million transactions totaling more than $25 billion.

In December, ARA revised its position on Flutterwave and claimed that investigations had shown the money was not connected to money laundering, the reason the CBK had blocked the license.

Several applications have been made to the court, either asking for a continuation of the billions in frozen funds or a share of the frozen monies notwithstanding ARA’s desire to withdraw from the lawsuit.

The court dismissed one of the applications yesterday.

After ARA indicated its intention to drop the litigation against Flutterwave, Justice Esther Maina denied the plea made by Mr. Morris Ebitimi Joseph on behalf of 2,468 Nigerian investors, stating that there is no justification for granting the application.

“I have carefully considered the application and my finding is that it has no merit. The ARA has intimated its intention to withdraw the petition,” the judge said.

The Nigerians asserted that they made the investment through a sports betting website that Flutterwave used to handle the transaction.

The judge stated that in light of ARA’s decision to abandon the action, the Nigerians’ fear that they would lose their money cannot be justified.

“The court sees no reason to grant the application sought,” she said.