Mobile Money Scam: Judge Questions MTN’s Credibility

The country’s leading Telecom Company MTN Uganda is facing a lengthy and thorny litigation process where six of its former employees allegedly swindled money amounting to Sh. 10.2 billion.

Using the company’s previous Mobile Money computer system named “Fundamo, ” the workers purportedly created from nowhere,  the billions of shillings and wired them to their own created mobile money accounts,  before resigning from their jobs.

The case currently before Justice Lawrence Gidudu, at the Anticorruption Court in Kololo is promising to unearth bit by bit, much of the rot there is, ever since the advent of Mobile Money business in the country.

Government prosecution is putting together all possible proof that the accused, led by former MTN Finance Manager Patrick Sentongo, essentially manipulated the MTN system to create nonexistent e-money [float] to a tune of 10 billion, and cashed it through the company’s associate Bank, Stanbic, straight into the country’s circulation.

Prosecution’s key witness Mr Praise Lubega –MTN’s former head of NIS department–had earlier last week proved in a PowerPoint presentation that indeed, with false entries, MTN Administrators were able to create fictional e-money on the company’s Adjustment Discrepancy Account.

While MTN cries foul, and prays for its former workers to face justice, experts told us this afternoon that the case could get the company entangled in serious money laundering and inflation gearing queries.

The old breached Fundamo system, [which was named after the South African company that created it], is still in existence at the MTN towers, though it has been deactivated and replaced.

Justice Gidudu questioned last week why such an unconfident system was still in existence and whether or not its owners would not consider selling it to other undeveloped countries “like Somalia”

Witness, Mr Lubega on Monday afternoon finalised submitting his evidence, in which he laboured to explain tons of the fundamo printouts that implicate the accused six in the grand fraud scandal.

Defense lawyers led by Counsel Obed Mwebesa will tomorrow Tuesday commence cross examination of Lubega’s testimony.

“You cannot miss out on this. It’s going to be interesting,” one of the defence lawyers Christine Akankwasa told our reporter in a chat.

Whichever way it goes, the Telecom Company is likely to be on the spot, another authority told us; first to explain how such a scandal could be crafted and executed in months, by its workers without notice.

Indeed Justice Gidudu has severally questioned the reliability of the company, in way of performing its duties.

“Do these people of MTN have supervisors at all; or does anyone do anything anyhow? What is the role of the CEO? To who are these people answerable?” the judge kept asking.

Second, the company could be held to account on the billions of shillings currently in circulation, whose origin is unexplained. Inflation!

MTN Disinclined?

In his testimony today, Mr Lubega told court that the key suspect Mr Patrick Sentongo, had created up to four User Names, namely SsentonP2010, Sentonp321, Sentonp2, and Senpat45; all of which he used to log in to the system and formulate journals on the company’s Mobile Money accounts, that were later cashed with the help of co-accused Joan Nabuggwawo; among other transactions.

The same person according to Lubega, had created another ghost employee in the names of Ronald Sebugenyi, whose account he fused with another co-accused Angela Ayo’s, to conceal the fraudulent deal.

These two were sharing the same passwords, despite an elaborate company policy that barred workers [users] from revealing, writing down or sharing their passwords.

In one of the meetings, Lubega revealed, it was disclosed that Mr Sentongo indeed possessed multiple usernames, and that the only action taken was to deactivate them.

Justice Giduddu on this point interrogated the seriousness of the top telecom company on matters to do with security of subscribers’ savings.

“A serious organization wouldn’t just ignore such a matter and move on. I would assume it is common knowledge that questions should have immediately emerged about the essence of these other usernames held by Mr Sentongo,” wondered Giduddu.

In another revelation, Lubega told court how former MTN Revenue Assurance Analyst Brian Okurut, without authorization, created 17 mobile money numbers, though which part of the ‘loot’ was channelled.

“In November 2011 for instance, Mr Okurut created a mobile money account in the number [0781807…,] and immediately credited it with Shs.4.2 million. Automatically the system deactivated the account because it was exceeding the Shs 4milllion threshold for any ordinary Mobile Money amount. A day later, Mr Okurut reactivated the account after it received another 15 million, bringing the balance to 19.2 million. Minutes later a couple of withdraws were made and the account was closed by Brian for the reason that ‘the holder had died!’

Brian Okurut from Revenue Assurance had no powers at all to deactivate or reactivate any mobile money account…”

When asked whether the MTN CEO was aware of the ongoing anomalies, Mr Lubega confessed that the CEO would only be briefed about them in the quarterly report as the company prepared to submit its compliance reports to Bank of Uganda.

Chimpreports will keep you posted on the developments as defence rolls out the cross-examination session tomorrow.

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