The three complainants are suing the telco and Vodafone Group for $2.38 billion in damages, alleging fraudulent misrepresentation, material nondisclosure of facts, illegal and unauthorized investment of money from M-Pesa account holders, predatory lending practices, and charging high interest rates very.
The Nairobi-based company has recently come under fire for the accuracy of its mobile overdraft service Fuliza, which is powered by the well-known M-Pesa mobile money service, as well as increasing cases of SIM swap fraud targeting Fuliza. limitation.
Safaricom allegedly has not paid interest to more than 32 million M-Pesa account holders, whose money was “used for lending and profit,” even though the company made money through a 15-year collaboration with the country’s commercial banks KCB and NCBA. to provide credit services.
It was also alleged that the Central Bank of Kenya (CBK) was aware of Safaricom’s “banking business”, but did nothing to control the telecom’s operations under the Banking Act.
The impression that Safaricom is not doing enough to fight the SIM swap scam, which has caused customers to lose millions through scams and scams aimed at mobile money services, adds to the company’s woes.
The threat is so widespread that in 2019, Safaricom implemented several measures to prevent its spread and warn consumers about the global problem that exists everywhere, which is not limited to East African countries or the continent.
Safaricom has often fallen victim to the same problem. Scammers have preyed on its clients, empty their bank accounts or commit crimes using the victim’s personal information.
At least four Kenyans are suing Safaricom and the country’s Communications Authority in court that began last week. The plaintiffs claimed they were victims of an alleged SIM switching scam.
In addition to the widower whose deceased wife borrowed money “straight from the grave” shortly after the burial, other parties who lost millions of dollars are also parties to the class action lawsuit. The prevalence of SIM switching fraud, also known as SIM splitting fraud, port-out fraud, or SIM jacking, is increasing not only in Africa but worldwide.