He was the CEO and Managing Director of First Bank of Nigeria, Gambia. Before then, he was a consultant with EY. Today, he is the MD/CEO of Pharakan & Associates Inc, Canada, a “professional services firm committed to providing support to clients across industries and sectors on the journey to optimize the Governance, Risk, Assurance, Control and Efficiency (GRACE) framework as a basis for building institutions that will last”.

Tomorrow, Tekedia Institute Faculty, Adefisayo Adefarakan – (FCCA CIA), will teach on how to navigate the year 2023 by making sense of the previous financial crises. Time for GRACE (Governance, Risk, Assurance Compliance & Efficiency )!

Tekedia Institute Mini-MBA >> The best teach here!

Africa’s largest fintech, Flutterwave, is once again enmeshed in a fraud scandal, which, this time, involves nearly N3 billion customers’ funds alleged to have been stolen by hackers.

TechPoint broke the news on Sunday, in a report which traced the matter back to early February 2023. According to the report, the incident was reported to the police while Flutterwave seeks to freeze the accounts that the hackers moved the funds to.

The report said: A motion to freeze accounts in 27 financial institutions in Nigeria, including Access Bank, Kuda, Zenith Bank, and OPay, was filled, with suit no. MISC/MC4/181/23, and later granted

According to documents seen by Techpoint Africa, ?2,949,557,867 has been illegally transferred from the accounts of African fintech unicorn, Flutterwave.

On February 19, 2023, Flutterwave’s legal counsel, Albert Onimole, reported the case to the Deputy Commissioner of Police, State Criminal Intelligence Department, Panti, Yaba, Lagos.

In an accompanying letter, Onimole stated that the hack on Flutterwave’s accounts occurred about two weeks ago from February 13. It was said that the money was initially transferred to 28 accounts in 63 transactions.

While the incident was reported to the police on February 13, 2023, with the list of accounts that had received the money, the police could not freeze the funds at the time. Onimole, in his letter, blames some commercial banks for allowing the money to be moved to other accounts, thus widening the money trail.

To further investigate accounts holding the stolen funds across various financial institutions in Nigeria, S.A. Adedesin, Legal Officer, State CID, Panti, Yaba, Lagos, filed a suit (MISC/MC4/181/23), dated February 27, at the Magistrate Court of Lagos (Yaba Magisterial District sitting at Yaba) to support Flutterwave’s claims. A motion ex-parte, it appears, was granted in favor of Flutterwave.

But the story took a twist on Sunday after Flutterwave issued a statement denying it was hacked. The African payment unicorn admitted that there was an unusual trend of transactions on some users’ profiles, but said no money was lost.

“We want to reassure you that Flutterwave has not been hacked. As a financial institution, we monitor transactions through our transaction monitoring systems and 24-hour fraud desk and review any suspicious activity. We collaborate with other financial institutions and law enforcement agencies to keep our ecosystem safe and secure.

“During a routine check of our transaction monitoring system, we identified an unusual trend of transactions on some users’ profiles. Our team immediately launched a review (inline with our standard operating procedure), which revealed that some users who had not activated some of our recommended security settings might have been susceptible.

“We want to confirm that no user lost any funds, and we take pride in the fact that our security measures were able to address the issue before any harm could be done to our users,” it said.

Despite this statement, some social media users have maintained that their bank accounts have been frozen because they were linked to the hack.

“I got a mail from my bank saying I’m a 4th beneficiary to this acclaimed fraud money. This was after over 5 days after a successful trade. My account is locked ?  can’t access fund inside. Pls is this right? It’s unfair I have zero business with flutter wave or the hack,” Twitter user @BiggyPrints tweeted.

Per the motion filed by Adebesin, which was noted in the report, 107 accounts in 27 financial institutions, including fifth beneficiaries of those accounts, are to be placed on lien/Post-No-Debit (PND).

However, Fluttewave’s rebuttal has created an argument on social media, with many taking the side of the payment giant even though some affected users have had to post evidence that liens have been placed on their accounts.

The court process/petition they have given my banks to put the restriction on my account and recall funds, is being processed by a lawyer they have denied, and stated "Flutterwave does not use this lawyer" pic.twitter.com/b65N0Ljo4H

— Ufedo (@UfedoDavid) March 5, 2023

This is not the first time Flutterwave is being reported on over fraud. Last year, investigative journalist David Hundeyin reported that the fintech and its CEO Gbenga Agboola (GB) are immersed in gross malpractice. Also in mid last year, a Kenyan court indicted Flutterwave in a fraud and money laundering investigation conducted by Kenya’s Asset Recovery Agency (ARA).

It is not yet clear who is telling the truth about the N3 billion hack. But there is growing concern that continuous negative reports about Flutterwave will have its growth prospect. The $3 billion company had last year, moved to get listed on the Nasdaq stock exchange, a giant leap that may be scuttled by these controversies.