Nigeria’s largest telecom firm, MTN Nigeria and MTN’s leading subsidiary in terms of sheer number of subscribers, has taken 18 banks in Nigeria to court over an alleged series of unauthorised transfers to the tune of $53.7-million.
The shady transfers were from an account reportedly owned by its mobile payment service bank (PSB) MoMo, which was only recently licensed in the West African country.
According to several Nigerian publications covering the story, MTN Nigeria alleges that the 18 banks, which are partners of the telecom, have wrongly transferred billions of Naira to 8000 accounts maintained by customers of the banks.
MTN has taken 18 banks in Nigeria to court over an alleged series of unauthorised transfers to the tune of $53.7-million.
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MTN through MoMo is currently seeking a court declaration that states that the fund deposits belong to MoMo and not the customers of the banks. Currently it seems that the funds have been withdrawn from the 8000 customer accounts.
Transfers from the MoMo settlement account were noticed on 24 May 2022, reaching a total of 700,000 transactions into the accounts across the 18 banks. MoMo PSB management then reportedly shut down the service and is persuing refunds from the banks. The service has since been restored, however.
“The transfers were due to the fact that the plaintiff suffered system exploitation which led to the said debits. There is no transaction between the plaintiff [MoMo PSB] and the recipient account holders that warranted the transfer of the funds to those accounts,” said Anthony Usoro Usoro, CEO of MoMo PSB, in the supporting affidavit to the suit.
According to Usoro Usoro, MTN Nigeria is only seeking legal action because the 18 partner banks have told the company that only a court order will allow them to return the funds to MoMo PSB.
“By virtue of the provisions of the 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 the plaintiff is entitled to a return of its money and the provision of the information which it requires from the defendants,” reads the suit, seen by TechCabal.
By Luis Monzon
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