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₦2.9 Billion Customer Funds: Customers report frozen accounts over illegal transfers from Flutterwave.. ( + Documents)

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2 years ago

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On Sunday, payments fintech Flutterwave denied a report that hackers stole ₦2.9 billion of customer funds. In its response to the story, Flutterwave said it noticed unusual activities in its systems and told users to activate safety protocols. But it insisted that customers did not lose any funds.

However, several sources revealed a different story. One of those sources told this publication that his company lost ₦8 million. Three other sources said their accounts were frozen for being beneficiaries of illegal transfers from Flutterwave accounts.

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On March 3, 2023, Alex Onyia tweeted about a hack at Flutterwave. Part of his tweet said, “Flutterwave has been hacked by Omar Edewor Trades, who has an account in Access Bank, and several millions of naira have been stolen from people’s [Flutterwave] accounts.” He advised everyone to get a new API key—one of the safety precautions that Flutterwave asked its users to take two days later.

Onyia is the CEO of Educare, a school management software provider that integrates Flutterwave and Paystack payment technologies into their software for educational institutions and other businesses. On a call with TechCabal, Onyia maintained that money was fraudulently transferred out of the Flutterwave accounts of his clients
through API calls.

He said, “On Thursday, March 2, 2023, I got a message from my account manager at Flutterwave asking if we authorised some transactions. I looked into the matter and was already blaming my dev team. I thought they introduced something new or a backdoor that was triggering the debit. After further investigation, I discovered that
there was no problem with my company and that there was a compromise in Flutterwave’s system.”

Onyia claimed that the hacker moved ₦4,990,000 out of the client’s Flutterwave account first and ₦3,360,000 moments later. “They even initiated a third debit for
₦3,360,000, but the balance wasn’t up to that, so it didn’t materialise,” he said.

Following the money trail
Onyia said that he called Access Bank, where the money had been transferred into an account named Omar Edewor Trades. “We called the bank, but we were told that the
money had been moved to another bank. After sharing the necessary documents, including information about the illegal transaction on Flutterwave, I asked Access Bank to
freeze the account.” According to Onyia, while the bank was investigating, it noticed that a lot of money was flowing into that account and immediately froze the
account.

“We asked the bank to send us back our money since there was money in the account and proof that about ₦8 million moved from our account to the fraudster’s. The bank
refused, saying that they had no right to, as based on the transaction trail, our money has been moved to a different account.” TechCabal could not verify that the
Access Bank account was frozen at the time of this report.

Onyia said that on March 3, Flutterwave asked customers to activate IP whitelisting, a security measure that was previously optional and asked everyone to change their
API keys. “If you know your system was not compromised, why are they asking everyone to take all these measures?”

Flutterwave’s response
Flutterwave answers this question in its official statement, saying, “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 (in line with our standard operating procedure), which revealed that some users who had
not activated some of our recommended security settings might have been susceptible.” However, the fintech flatly denied that any user lost any funds, as its security
measures were “able to address the issue before any harm could be done to our users”.

But court documents seen by TechCabal raise questions about Flutterwave’s version of events. Those documents include certified true copies of a petition by
Fluttewave’s legal counsel to the police dated February 20, 2023. The letter asked for police assistance to recover funds by obtaining court orders from the magistrate
court to sustain account freezes on 107 bank accounts in 27 banks that allegedly, directly or indirectly, received money from the illegal transfers from Flutterwave accounts.

Some of the frozen accounts
Ajeka Iliasu Opaluwa, owner of Pajek Signature, a cryptocurrency trading business, is listed in court documents as a first beneficiary of the illegal transfer from
Flutterwave accounts. A first beneficiary is an account that received a transfer directly from a Flutterwave account. On a call with TechCabal, Opaluwa said, “I sold
USDT worth ₦1.6 billion to William Atong Chen, a Chinese merchant who has been a customer since 2019. When we first transacted five years ago, my partner met him in
Lagos to complete KYC (know your customer). The transactions started on February 5, 2023, and I got paid, just like all the others I have had with him. It was on
February 7, 2023, after the trade had been concluded, that the bank froze my account.”

Opaluwa told Chen that the bank had frozen his account. “I asked him to come to the bank and help me resolve the issue, but he said he was no longer in Nigeria. His
Nigerian numbers are still reachable, and when I call him to recount my plight, he insists that he made the transaction in good faith and that it was not stolen money
he sent to me,” Opaluwa said on the call.

Opaluwa insists that the Chinese customer’s name is William Atong Chen, however, the only Chinese name found on Flutterwave’s court document listing bank accounts to
be frozen is Quiang Chen. Opaluwa shared evidence of the transaction with TechCabal. “I made the transaction lawfully. I sourced USDT, and when I saw evidence that I
had been paid, I handed them over. Three days later, somebody comes to tell me that the money I was paid was stolen. Was I supposed to take it to a digital money
detector? How could I have known the money was stolen?” he asked on the call. He told TechCabal that he has filed a petition against Flutterwave as he is also a
victim.

The accounts of other crypto traders who received payments for crypto assets from Opaluwa were also frozen. David Ofedu Audu, whose five bank accounts are listed on
Fluterwave’s petition for account freezing, is one of them. Audu told TechCabal that his transactions with Opaluwa started on February 5 and ended on February 7. The
day after, February 8, his five accounts were frozen.

He also shared an email from StanbicIBTC Bank confirming that his accounts were frozen because of the illegal transfers from Flutterwave accounts. His account manager
at Providus Bank, where his accounts were also frozen, cited the same reason for the freeze, on a call.

“I am a second beneficiary because the person who paid me received the money directly from Flutterwave. Opaluwa bought USDT from me for a Chinese customer called
Chen,” Audu said on the call. In the court documents, Chen’s account is listed as one of the accounts frozen for receiving funds from the impacted Flutterwave
accounts.

TechCabal also spoke to sources whose accounts were blocked but who claimed they had no dealings whatsoever with Flutterwave. Henry Awaka, one such person, told
TechCabal that his Fidelity Bank account was frozen around the same period. He told TechCabal, “I sent several emails to Fidelity Bank but got no response.”

He remained in the dark until his friend, who was a second beneficiary, saw his name in the court documents and told him about it. According to the document, Awaka’s
Fidelity bank account is a fourth beneficiary and received ₦1,199,291 from an account named Nnam Monday Kingsley at Providus Bank. Awaka said that he traced the
transaction and discovered that it was from a bulk sale of alcoholic drinks—350 crates of Trophy and 27 crates of Budweiser alcoholic drinks.

Awaka is a sales manager at an international brewery and he claimed he makes these sorts of transactions regularly. He didn’t suspect that he had become a beneficiary
of some of the N2.9 billion illegally transferred from Flutterwave accounts. He has since emailed his bank several times with the receipt of his transaction but has
received no response. “Fidelity Bank is so complacent about the matter,” he said. According to him, there are about 180 people in a Whatsapp group whose accounts have
been frozen after making one legitimate transaction with someone who received money that came from the Flutterwave account.

 

Source: The Tech Cabal

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Absence Of Oba Otudeko, Bisi Onasanya, Others Stalls Arraignment Over N12.3Billion Fraud As Otudeko’s Lawyer Protests In Court

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January 20, 2025

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The counsel for Oba Otudeko, Chairman of Honeywell Group, who is facing charges of a N12.3 billion fraud, appeared before a Federal High Court in Lagos on Monday to protest the charge.

Mr. Bode Olanipekun (SAN) informed the court that he was protesting because the charge had not been served on Otudeko or the two other individuals charged alongside him, the News Agency of Nigeria reports.

Olanipekun informed the court that, despite not being served with the charge, the defendants were shocked to learn about the planned arraignment through the media when the story broke last Thursday.

The 13-count charge was filed by the Economic and Financial Crimes Commission (EFCC) against Oba Otudeko, former Managing Director of FirstBank Plc. Olabisi Onasanya, and former Honeywell board member Soji Akintayo.

Olanipekun is the counsel for the three defendants.

They were charged alongside the company, Anchorage Leisure Ltd.

 

The EFCC alleges that the defendants obtained the sum under false pretenses.

 

According to the EFCC, the four committed the fraud in tranches of N5.2billion, N6.2billion, N6.150billion, N1.5billion and N500million, between 2013 and 2014 in Lagos.

 

The 13-count charge, filed by EFCC counsel, Bilikisu Buhari, on January 16, 2025, further claimed that the defendants used forged documents to deceive the bank.

Specifically, count 1 accused the defendants of conspiring “to obtain the sum of N12.3Billion from First Bank Limited on the pretence that the said sum represented credit facilities applied for by V-TECH DYNAMIC LINKS LIMITED and Stallion Nigeria Limited, which representation you know to be false.”

 

In Count 2, it was alleged that the defendants, on or about 26th day of November, 2013 in Lagos, “obtained the sum of N5.2 billion from First Bank Limited on the pretence that the said sum represented credit facilities applied for by V TECH DYNAMIC LINKS LIMITED which representation you know to be false.”

 

The 3rd count alleged that the defendants, between 2013 and 2014 in Lagos, obtained N6.2billion from First Bank Limited on the pretence that the said sum represented credit facilities applied for and disbursed to Stallion Nigeria Limited, which representation you know to be false.”

 

In the 4th count, they were accused of conspiring to spend the N6.15billion, out of the monies.

According to the Commission, the offences contravened Section 8(a) of Advance Fee Fraud and Other Fraud Related Offences Act 2006 and was punishable under Section 1(3) of the same Act.

Counts 5 reads: “That you, Chief Oba Otudeko, Stephen Olabisi Onasanya, Soji Akintayo and Anchorage Leisure Limited on or about 11th day of December, 2013 in Lagos, procured Honeywell Flour Mills Plc to retain the sum of N1.5 billion, which sum you reasonably ought to have known forms part of proceeds of your unlawful activities to wit: Obtaining by False Pretense and you thereby committed an offence contrary to Section 18(c), 15 (2) (d) of the Money Laundering (Prohibition) Act, 2011 (as amended) and punishable under Section 15(3) of the same Act.”

Meanwhile, Otudeko had reportedly fled Nigeria ahead of his scheduled arraignment on fraud charges.

 

According to TheCable Newspaper, Otudeko’s exit from the country is linked to the mounting legal pressures and financial disputes he is facing.

The newspaper reported that the businessman left the country via one of the land borders.

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Loan controversy: Bisi Onasanya’s lawyer condemns media trial….Judge adjourns case to February 13

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1 hour ago

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January 20, 2025

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In line with his resolve to defend himself and clear his name, Dr. Bisi Onasanya through his lawyer, Adeyinka Olumide-Fusika, SAN, at a session at the Federal High Court Lagos on Monday, January 20, 2025, demanded the service of proof of evidence and summons.

Onasanya, a chartered accountant and a former Group Managing Director of First Bank is defending himself against a controversial loan that allegedly occurred at First Bank 12 years ago. The retired banker is refuting the allegations alongside three others namely former Chairman of the bank, Chief Oba Otudeko, a former board member of Honeywell, Soji Akintayo, and a firm, Anchorage Leisure Ltd.

At a hearing at the Federal High Court in Lagos on Monday, Fusika condemned the media trial his client had been subjected to, saying he was not formally invited by the EFCC or served a notice of the charge.

He expressed surprise at seeing news stories in major newspapers linking Dr Onasanya to a trial on loan controversy during his time as First Bank Group Managing Director without prior notification.

“My Lord, it is concerning that my client has been unduly exposed to media trial without being formally served. This is a procedural anomaly that undermines his right to a fair hearing and personal dignity,” Olumide-Fusika said.

The prosecuting counsel, Rotimi Oyedepo, denied any involvement by the EFCC in the media coverage of the case.

He stated that the commission had not issued a press statement and suggested that journalists may have obtained information through other means.

“My Lord, we disassociate ourselves from any media reports,” Oyedepo said.

The EFCC also applied for an ex parte motion to issue a bench warrant for the defenders’ arrest and sought permission to serve them through substituted means, alleging they had evaded service.

Olumide-Fusika opposed the motion, arguing that his client had always been available and had not evaded service. Demonstrating his determination to clear his name, the senior lawyer prayed to the court to have the EFCC serve the charge and the proof of evidence in the open court.

“This application is unwarranted and speculative. My client has neither avoided service nor absented himself from this matter. The claims of the prosecution are baseless. Since I am here and my client is ready to go ahead with this case, I ask to be served the charge and the proof of evidence here in the court,” Olumide-Fusika argued.

Justice Chukwujekwu Aneke, who presided over the case, dismissed the EFCC’s motion for substituted service on Onasanya since he has accepted to be served in the open court.

The judge consequently ordered that the EFCC serve Olumide-Fusika the charge and proof of evidence in open court.

The EFCC complied with the directive, and Olumide-Fusika who confirmed the receipt of the document extracted a confirmation from the prosecution counsel that the proof of evidence submitted is exhaustive and there wouldn’t be an addendum. The defence counsel said EFCC’s confirmation should be on record, insisting that his client was ready to defend himself and clear his name.

Justice Aneke adjourned the case to February 13, 2025.

It will be recalled that Onasanya, through his Communication Advisor, Mr Michael Osunnuyi, had earlier dismissed allegations, describing the claims as baseless and an attempt to tarnish Onasanya’s stellar reputation for professionalism, integrity and humaneness.

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Abuja-Lagos Super Highway Project faces threat as two consortiums engage in battle for FG’s nod

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1 hour ago

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January 20, 2025

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AEC Unity Network Limited, the officially recognised concessionaire for the Abuja-Lagos Super Highway and High-Speed Train projects, has denied any association with an entity known as AEC-Geofocus Consortium (Geofocus).

AEC Unity Network clarified that Geofocus has no role in the planning, financing, construction, or operation of the 470-kilometer superhighway and high-speed rail projects, which are part of President Bola Tinubu’s Renewed Hope agenda to boost national infrastructure.

In a statement released on Sunday, the company emphasised that it is the sole concessionaire authorized by the Federal Government of Nigeria, having received approvals from the Federal Ministry of Works, the Federal Ministry of Finance, and the Infrastructure Concession Regulatory Commission (ICRC).

Barrister Ayodeji Ademola, legal consultant for AEC Unity Network, said in the statement that AEC-Geofocus has no basis whatsoever to make any claim in relation to the Super Highway project, having not been part of its conception from the onset.

In the statement, AEC Unity Network reaffirmed that it is the sole concessionaire authorised by the Federal Government of Nigeria to design, finance, construct, operate, and maintain the 470-kilometer superhighway and high-speed rail linking Abuja and Lagos.

According to the statement, the company’s approvals are from the Federal Ministry of Works, the Federal Ministry of Finance, and the Infrastructure Concession Regulatory Commission (ICRC).

The reaction by the AEC Unity Network may have been informed by media publications credited to one Engineer Mutiu Yinka Idris, who asserted that AEC-Geofocus was in charge of the project for the federal government.

Idris, who claimed to be Director of Operations for AEC-Geofocus, had in the publication described the company as a consortium of engineers, planners, and investors that had successfully attracted $16 billion from Middle Eastern investors, with additional interest from European financial institutions and the World Bank.

He had also claimed that the financial framework was designed to minimize government expenditure, safeguard public funds, and prevent cost overruns through an efficient risk-sharing mechanism.

Idris had assured stakeholders of a grand project flag-off before February 2025, reiterating AEC-Geofocus’ commitment to delivering world-class infrastructure.

“The $16 billion project will be led by AEC-Geofocus, a consortium of engineers, planners, and investors, and plans have been concluded to commence it by February this year, 2025,” Idris had asserted.

He said that the Lagos-Abuja corridor, spanning approximately 500 kilometers, will connect Lagos, Ogun, Oyo, Osun, Kwara, Kogi, and Niger states before reaching Abuja, under a design, Build, Finance, Operate, and Maintain (DBFOM) model.

But in its sharp reaction, AEC Unity Network expressed surprise at the emergence of AEC-Geofocus out of the blue to make claims on a project it was never part of.

Part of the statement read: “We emphatically state that AEC Unity Network Limited has no relationship whatsoever with AEC-Geofocus Consortium or Geofocus. Any claims made by Geofocus regarding involvement in the projects are ‘spurious and false.’”

“We categorically state that AEC Unity Network Limited has no relationship whatsoever with Engineer Mutiu Yinka Idris or Geofocus.”

“These fraudulent claims are completely at variance with our proposed infrastructure plans and are intended to confuse and defraud unsuspecting stakeholders,” the statement added.

The statement by Engineer Mutiu Yinka Idris, who claimed involvement in the projects on behalf of Geofocus in several media outlets and amplified on social media, is baseless and an attempt to mislead the public.

The company warned investors and the public to disregard any media advertisements or reports from Geofocus, describing them as unauthorized and misleading.

AEC Unity Network stated that its project is still in the planning stages, with no concurrent developments on the same corridor by any other entity.

To prevent confusion and potential fraud, AEC Unity Network urged local and foreign investors to verify information only through its official channels and avoid engaging with Geofocus on matters relating to the Abuja-Lagos Super Highway and High-Speed Train projects.

This infrastructure initiative, which includes a direct expressway and rail connection between Abuja and Lagos, is expected to enhance transportation efficiency and foster economic growth.

AEC Unity Network reiterated its commitment to transparency and professionalism, urging the public to engage only through its official channels for accurate information about the projects.

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