Nigerian fintech startup, Kora has reacted to the allegations of fraud and money laundering levied against the company and liquidity management provider, Kandon Technologies in Kenya, describing it as empty and unfounded.
Founded by Dickson Nsofor, Kora is a pan-African payment infrastructure offering a robust payment API for payment collections (payins) and disbursements (payout), and settlements.
Kora services enable global companies to scale rapidly across Africa. With a single integration, Kora powers businesses to accept payins, payouts and settle across popular payment channels.
Reacting through a statement, the company said the $250,000, for which it was taken to court was legally deposited in its Kenyan account as part of the capital requirements from the Central Bank of Kenya (CBK) for obtaining a payment service provider and remittance operator license.
Kora, which expanded its operations into Kenya last year, says it has documents supporting its position and expresses confidence that the Kenyan courts will see that the accusations against the company are not only wholly baseless but borderline malicious.
Korapay and Kandon Technologies Limited are being accused of card fraud and international money laundering.
Kenya’s Asset Recovery Agency (ARA) had filed 2 suits against the businesses and the High Court has frozen their accounts on the suspicion that they brought over $50 million (KES6 billion) into Kenya as part of a money laundering scheme.
Lady Justice Esther Maina froze $249,990 (KES 29.5 million) held in Korapay’s Equity Bank account while Kandon Technologies had $126,800 (KES 15 million) in 2 UBA accounts frozen by Justice Maina.
ARA says the two companies are part of an international ring of fraudsters using Kenyan banks to receive money from an untraceable foreign source.
Their activities came under suspicion when an account received $249,990 (KES 29.5 million) in a single transaction. Investigations by Kenyan authorities reveal that between October 2021 and April this year, the bank accounts had cumulatively handled (KES 5.5 billion).
ARA says it has verified that the companies were established in Kenya to utilise the country’s liberal financial system to launder funds. So far, investigations have linked both companies to a Kenyan businessman—Simon Karanja— whose bank accounts were also frozen.
What they are saying
However, responding to the allegations, Kora in a statement issued by its Head of Marketing and Communications, Gbenga Onalaja, explained: “As part of the capital requirements from the CBK for obtaining a payment service provider and remittance operator license, Kora deposited the sum of $250,000 in its freshly opened bank account. In line with CBK requirements, this amount was left untouched pending the granting of our license. Easily verifiable records of this account will show that the $250,000 deposit is the only transaction carried out on that account to date.”
“Unfortunately, Kora has been dragged through Kenyan courts on empty, unfounded allegations of money laundering since May of 2022. As a responsible corporate citizen, we have consistently challenged all these allegations in court and will continue to do so; we have documents that support our position. We are confident that the Kenyan courts will come to see that the accusations against us are not only wholly baseless but borderline malicious.
“Kora is deeply committed to being an ethical African payments company. Across all the jurisdictions we operate from, we hold ourselves to strict compliance standards through stringent anti-money laundering (AML) processes. We plan to continue our engagement with Kenyan regulators to resolve this matter as Kenya remains a crucial component of our African ambitions,” it added.
Reacting via a statement which is dated the 7th of June, Flutterwave Kenya has denied involvement in any financial improprieties in the guise of providing merchant service as contained in recent reports.
The company said it earns its fees through a transaction charge, records of which are available and can be verified.
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