MTN’s Momo service experiences security breach, loses N22.3bn – TrendyNewsReporters

MTN’s Momo service experiences security breach, loses N22.3bn

by Ebor Cletus Ralph Jr

Following a security attack on the fintech’s system, Momo Payment Service Bank Limited, a subsidiary of MTN Nigeria, lost N22.3 billion and was had to temporarily cease operations.

On May 24, 2022, the incident took place after Momo PSB executed 700,000 transactions and transferred funds to around 8,000 third party accounts held by 18 banks. The firm filed a lawsuit against the financial institutions six days after making attempts to recover the funds.

It was discovered that the N22.3 billion were transferred to Zenith Bank, Guaranty Trust Bank, First Bank, Access Bank, Union Bank, Wema Bank, Sterling Bank, and Polaris Bank in the lawsuit with the file number FHC/L/CS/960/2022.

Ecobank, Stanbic IBTC, Providus, Unity, Unitex Bank for Africa (UBA), Fidelity, Standard Chartered, First City Monument, Suntrust, and Heritage Bank are all included in the list.
Momo PSB requested the reversal of the funds from the accounts as well as customer information in case part of the funds had been transferred to another bank. Commercial banks, however, demanded a court order before they would provide Momo PSB with the information, which is why the subsidiary of MTN filed the lawsuit.

The payment company asked the court to declare that Momo PSB, not the client who received the payments, is the rightful owner of the money paid to the 8,000 accounts in the 18 Nigerian banks.

The court filings read, “A declaration that the deposits of an aggregate sum of N22,300,000,000.00 erroneously transferred by the plaintiff to the accounts of the customers of the defendant banks, having been done in error, belongs to the plaintiff and not the customers of the defendant banks.

“An order directing the defendant banks to each, individually, account for the sums available in their customers’ accounts and the sums which have been removed by the customers and are no longer available.

“An order directing the defendants’ banks to immediately return the aggregate sum of N22,300,000,000.00, less those funds that are no longer available, to the plaintiffs’ settlement account in the name MOMO PSB settlement account number: 2041379385 at First Bank Plc Samuel Asabia House 35 Marina, Lagos, from where the funds originated.

“An order directing the defendant banks to release all information, including account name information in respect of the accounts from which the plaintiff’s funds have been transferred to third parties, including the destination accounts and the banks in which they are held to assist in the tracing and recovery of those funds.” the company told the court.


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