New Telegraph

February 29, 2024

MTN sues 18 banks over alleged N22bn mobile money fraud

MTN Communications Limited’s newly licensed Mobile Money Payment Service Bank Limited (MOMO PSB) has alleged a fraudulent loss of N22 billion in one month of operations. In a suit instituted by the MTN bank against 18 banks in the country, the subsidiary service provider revealed that an aggregate sum of N22,300,000,000, which is an equivalent of about $53.7 million, was transferred in error to accounts maintained by customers of the banks in the country. In an originating summons dated May 30, brought by Lotanna Chuka Okoli (SAN), MTN’s MOMO PSB is contending that the funds, having been erroneously transferred, belonged to it and not to the customers of the banks.

Among other reliefs, the MTN bank is also seeking an order of the court directing the 18 banks to individually account for the sums available in their customer accounts and the sums, which have been removed by the customers and are no longer available. In an affidavit in support of the originating summons, the Chief Executive Officer (CEO), MOMO PSB Ltd, Mr. Anthony Usoro Usoro claimed that MOMO PSB Ltd is the bona fide owner of the aggregate sum of N22.3 billion, which is maintained in its MOMO settlement account. He averred that on or about the 24th day of May, 2022, it was noticed that funds had been erroneously transferred from its settlement account to various accounts maintained by the 18 banks. Usoro further claimed that a total of 700,000 transactions were processed with credits made into about 8,000 various accounts in the listed 18 banks.

He stated that upon becoming aware of the incident, MOMO PSB Ltd management responded by immediately shutting down the service to limit the impact and triggered engagement with the banks for the commencement of recovery activities from the accounts of the various beneficiaries in the 18 banks. MOMO is contending that under the Central Bank of Nigeria (CBN) Regulation on Instant (Inter-Bank) Electronic Funds Transfer Services, made pursuant to sections 2(D), 33(1)6) and 47(2) of the CBN Act 2007, it is incumbent on the 18 banks to make refund and provide the required information. Meanwhile, the court is yet to fix a date for the hearing.

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