Ecobank has been bursted over its role in the Sh4 billion fraud case involving an online payment firm that is associated with an international credit card scam syndicate.
The lender is facing two charges where it is accused of conspiring with Kiwipay, and some crooked Kenyan corporate moguls to illegally withdraw money belonging to two clients, who are also associated with the foreign firm.
Eco bank authorized the fraudulent withdrawal of more than Sh2.8 billion held in three bank accounts belonging to a woman from the Southeast Asian nation of Laos.
The case filed by Ms Monthida Rashi is accusing the bank of releasing a sum of $23,452,493 (Sh2,878,793,515) to Kiwipay Ltd, a New Zealand-based online payment firm.
Ms Rashi filed the case days after another company, Avistia S.R.O Ltd, took Eco Bank for allowing Kiwipay to withdraw $13,473,110 (Sh1,653,824,252) from its three bank accounts.
Ms Rashi who is the director of Paygram Company Ltd claimed that the money held in her company’s accounts were debited into accounts of other entities including Kiwipay PTE and Kiwipay Kenya Ltd without her consent and knowledge.
But court documents also revealed that she is a former director and shareholder of Kiwipay Kenya Ltd.
Kiwipay PTE ltd which is registered in Singapore, offers digital payment solutions including QR Code solutions for retail shops, hotels and restaurants by enabling foreign e-wallet solutions like Alipay, SamsungPay, ApplePay, WeChatPay and many more.
The disputed amount is part of funds that had been frozen by High Court in March 2021 over allegations of money laundering and credit card fraud.
Investigations by Asset Recovery Agency (ARA) cleared Kiwipay of any wrong doings, prompting the withdrawal of forfeiture case on October 26, 2022.
The move was made after Laos based investigators claimed that KiwiPTE was not part of money laundering or tax evasion syndicates.
But Ms Rashi argues that following unfreezing of the accounts, Eco Bank allowed transactions of Kiwipay accounts leading to the release of the funds.
She is demanding a refund of $11,134,831 from Eco Bank on behalf of Kiwipay Kenya Ltd, which was withdrawn from her dollar account without her consent.
She also wants $8,804,831 from Kiwipay PTE Ltd and its director Mr. Gregory Schimdt who is her former business partner.
She is further pushing for the recovery of the money on behalf of Paygram Company Ltd.
The company is also seeking a refund a refund of $3,512,831 from Kiwipay Kenya Ltd as Ms Rashi further argued that she lost the money through eight transactions done between October 28 and November 22, 2022.
She told the court that on October 28, a sum of $1.8 million was debited as a recovery of chargeback fees and penalties due to Eco bank. “I am not aware of any sum due to Ecobank from the Kiwipay Kenya Ltd. Despite the request, the bank has failed to provide any reasons to explain or justify such a large amount of money which they debited to the company’s account without any notice,” Ms Rashi said.
Rashi was also surprised to learn that on November 16, 2022, some $930,000 was wired from Kiwipay Kenya limited to another internal account, IFO Kiwipay Kenya limited, as legal fees. “I am not aware of any legal fees to be paid to Kiwipay Kenya Limited. There is no credible innocent explanation for this transfer. A demand to Ecobank for an explanation has been ignored,” Ms Rashi said.
The newly appointed EcoBank’s CEO, Mr. Jeremy Awori now risks serving a jail term after the bank defied complying with court orders emanating from similar allegations.
Commercial Court judge Dola Chepkwony gave Avistia S.R.O Ltd green light to pursue Mr Awori and two other senior bank managers- Samuel Odhiambo and Eva Schumatez Anyango over the heated court battle pitting Avistia S.R.O Ltd against KiwiPay PTE Ltd and KiwiPay Kenya Limited.