A month after Castle Logistics Services Limited, a Jumia (Jade Internet E-Services Nigeria Limited) vendor, petitioned the Nigerian Police over alleged fraudulent conversion and diversion of N214.695 million by Jumia Food, officers of Nigerian Police Force, Zone II, Lagos, have arrested Guy Futi, the Managing Director of Jumia Food.
Adewumi Adegoke, a member of the anti-fraud unit, confirmed the arrest, stating that there’s ongoing investigation into allegations made against Jumia Food and the company’s Managing Director.
“I can confirm that the Managing Director of Jumia Food was arrested and is in our custody. Investigations are ongoing on the allegations levelled against him and the company.”
Jumia statement on arrest
Jumia, however, debunked the arrest statement but confirmed Guy Futi was at the Police station to honour police invitation, refuting claims that the Jumia Food MD misappropriated the company’s funds.
“Jumia Food MD neither misappropriated the company’s funds nor converted them for personal use.
“If this had happened, Jumia would have taken a legal action against him and probably involved the press. I say, unequivocally, that Jumia Food MD was never involved in any fraudulent act.
“If truly this happened, why would Jumia cover up for him? Is an outside source more credible to tell an alleged story of fraud within Jumia than the company management? Again, there’s no basis for hiding an employee’s fraudulent act if truly the employee committed such act.
“Jumia has an outstanding court case against a vendor (3PL) partner, who owes the company and has refused to pay. It is on the basis of the court case filed against the vendor that Jumia Food MD, Guy Futi, was invited by the Police for questioning.
“Guy Futi was never detained by the Police. He was invited for questioning and left the station after the interrogation same day. The Police should provide a physical evidence of him in detention or else the information you were supplied with was completely false and has a malicious intent.
“A visit to the supposed station where he’s alleged to be waiting for bail will add so much credibility to your story.
“Guy Futi had not joined Jumia as an employee at the time the vendor’s debts started accumulating. He’s barely new at Jumia Food. The allegations are completely untrue and appear to be a cheap effort by a third party to distract the public from the main issue and malign Jumia’s image.”
Castle Logistics petition
The allegations were made by one Mrs. Catherine Azubuike, in the petition dated December 24, 2018. Castle Logistics had claimed false presence, fraudulent conversion and diversion of N214.695 million by Jumia Food.
Castle Logistics were to provide personnel services and equipment to Jumia Food for delivery of food supply requests made online by its customers after entering into a Service Level Agreement in August 2016. The agreement also contains involves the collection of monies and consequent remittance of same to Jumia.
In a Vanguard report, it was alleged that on May 2018, Jumia was said to have been able to pay for only August 2016 to March 2018, and fell short of the payment of N214,695,445.49, and upon a thorough investigation into the payment collection system, they found out that Jumia, without Castle’s consent and permission, gave to some of the riders Jumia Food’s personal POS for collection of payments from customers, and effectively those payments were rendered directly into Jumia Food designated accounts, adding that Jumia stole and converted the said sum for own use.
Castle Logistics stated Jumia Food was informed to provide it with complete bank reports of the transactions on those POS machines, but Jumia refused.
“Jumia Food refused, but rather chose to randomly estimate a percentage of the total funds received from those POS machines as funds related to orders handled by Castle. This resulted in huge monthly shortfalls on orders handled by Castle and Jumia Food kept demanding Castle to remit funds for those shortfalls without providing the POS reports.”
In the petition, Jumia was accused of diversion of funds, and also alleging Jumia deceived them into remitting funds to its bank account with clear intention to permanently deprive them of its use.