Tony O. Elumelu, group chairman, United Bank for Africa (UBA) Plc, has said that the Corona virus pandemic has presented a perfect opportunity for foreign investors to invest in Africa, owing to the huge opportunities that are inherent in the African economy.
“This is the time to invest. Africa is a land of opportunities; There is huge population and there is now the realisation by African leaders who are creating an enabling environment to encourage these investments,” Elumelu said on Thursday, while speaking at a virtual session organised by the TIME100TALKS on the theme, ‘Empowering Entrepreneurs’.
Bill Gates, Founder of Bill and Melinda Gates Foundation and United States Senator, Tammy Duckworth were other thought leaders who also spoke in sessions at the event.
While pointing out that the African continent is well positioned to emerge into a strong digital economy, Elumelu said, there is now more macro-economic stability than ever before, especially given that the young African is energetic, restless and has the ambition to succeed, in the face of difficult circumstances.
“Challenges exist in Africa, but we have huge returns on investments. There is huge population and there is realisation by African leaders who are now creating an enabling environment to encourage investments into Africa. There is no better time to make the multi-million dollar bet I made in Africa, than the times we live in now,” he said in a chat with Kimberly Dozier, a Time Correspondent who moderated the session.
Speaking on the effect that the pandemic has had on the operations of UBA in the last few months, Elumelu noted that there has been a rapid increase in technological embrace and called for the strengthening of infrastructure, networks and digital platforms to support the growth.
“In banking business this whole digital transformation is heightened further by COVID-19, right now, you have less than 15% of our over 20million bank customers that are transacting in the bank. Most of them now transact online, which is 85% of over 20million customers. That is significant. Before COVID, it was about 65%. UBA is seeing an explosion in its digital platforms. Thankfully, the bank invested significantly in technology, and now, they are investing even more so that they can serve their customers better. So, the digital connectivity technical infrastructure should be strengthened in such a way as to aid this explosion we are seeing,” Elumelu said.
He also spoke on how the Tony Elumelu Foundation, which he founded, has been supporting the growth of its entrepreneurs especially in the tough business climate presented by the ravaging coronavirus pandemic.
“Through the TEF virtual platform called the TEFConnect, we are able to engage our entrepreneurs on a day-to-day basis; get resource speakers from all over the world and ourselves, to talk to them and to train them and let them know how to manage difficult moments like this. And I can say that at-least 72% of our 9,500 beneficiaries are hanging in there, expanding their businesses. You know most SMEs typically die after their first year, but we are seeing a different trend, where beneficiaries of our programme in different countries are contributing towards fighting the virus in their different countries. We are seeing the creation of jobs, the one million jobs we set out to achieve,” he noted.
The TEFConnect Community is a meeting ground where entrepreneurship ecosystem players share information and ask questions on their business activity. Currently one million entrepreneurs are on TEFConnect
Elumelu seized the opportunity to call on all bodies and key sectors such as the private sector, public sector, development agencies like the African Development Bank and other institutions to work together to make a difference, adding that “What the world needs today and Africans, in particular, is hope and that to me is what will make the difference but that hope has to be backed by tangibility, some substance so that we can make it work.”
In his submission, Bill Gates sought for collaboration between the private and public sector to end the pandemic, adding “Every country has to think through the right policies to stop the spread, there is need to speed up the process of getting new drugs and vaccines, we need a global response.”
Senator Duckworth who also emphasised the need for funding for teaching and appreciation for teachers, advocated for more teamwork at all levels to fight the pandemic, said, “What the country needs is a team that will step forward to deal with the crisis. It is very significant for me to be on a national stage for other Asian Americans, because we often are the forgotten minority in this country.”
TIME100 Talks, an initiative of TIME magazine, is a new live event series that convenes leaders from every field to spotlight solutions to urgent global problems and encourage cross-disciplinary action.
Huge Consumer Loans Weigh Banks Down
A Central Bank of Nigeria (CBN), Survey Report has shown that banks experienced higher loan default rates on credit cards and overdrafts/ personal lending to household in the third quarter of the year (Q3’20).
The survey also noted that lenders expect to tighten the conditions for which loans are given to borrowers (loan covenant) in the next quarter (Q4’20).
The Survey Report titled :”Credit Condition Survey Report for Q3’20″ stated:”Lenders experienced higher default rates on credit card and overdrafts/personal lending to households in Q3’20 but expect lower default rates in Q4’20.
“Losses given default on total unsecured loans to households and overdraft/personal loans to households both declined in Q3 2020.
CBN “Similarly, default on total unsecured loans to households was expected to worsen further while default on overdraft/personal loans to households would improve in Q4’20.
“Lenders required stronger loan covenants from all firm sizes in Q3’20, a stronger loan covenant is expected in Q4’20.”
According to the report, “the overall availability of credit to the corporate sector increased in Q3’20 and is expected to increase in Q4’20. This was driven by changing sector-specific risks, changing economic conditions, changing appetite for risk, market share objectives and changing liquidity conditions.
“ On credit availability, the report noted: ”Availability of credit increased for all business sizes in Q3’20, while the same trend is expected in Q4’20.
Access Bank Gets CBN’s Nod to Restructure into Holdco
Access Bank, the biggest retail bank in Africa, has announced that it has received Central Bank of Nigeria (CBN’s) Approval-in-Principle to restructure to a Holdco.
The bank has also received regulatory approvals to commence operations in Mozambique under the name Access Bank Mozambique, S.A. (Access Bank Mozambique), and plans to acquire a majority holding in South Africa’s Grobank Limited.
The bank revealed in a notification which was filed at the Nigerian Stock Exchange (NSE) and signed by Sunday Ekwochi, company secretary, that its desire to operate as a Holding Company would enable the bank to further accelerate its objectives around business diversification, improved operational efficiency, talent retention as robust governance.
With its vision of being Africa’s gateway to the world, Access announced that its subsidiary, Access Bank Mozambique, has entered into a definitive agreement with ABC Holdings Limited (ABC Holdings), a wholly-owned subsidiary of Atlas Mara Limited (Atlas Mara) to acquire African Banking Corporation (Moҫambique), S.A., (BancABC Mozambique) for cash, in a combination of definitive and contingent considerations.
Access Bank has also entered into a definitive agreement with GroCapital Holdings (GroCapital) to invest in Grobank Limited over two tranches.
The first is an initial cash consideration for a 49 percent shareholding and subsequently increased to a majority stake in the second tranche.
Both tranches are subject to various regulatory approvals and the overall transaction is also subject to Grobank’s shareholder approvals.
GroCapital, whose shareholders include the Public Investment Corporation – which doubles as Africa’s largest investment manager, and Fairfax Africa Holdings – a leading global investor, will retain an existing but diluted shareholding in Grobank as part of the outlined transaction terms.
Speaking on these developments, Herbert Wigwe, GMD/CEO Access Bank said: “We have consistently said that we are focused on building the scale needed to become a leading African bank; one that leverages our experienced and growing talent base and key stakeholder partnerships towards driving sustainable impact and profitability. Today’s announcement demonstrates further commitment to delivering our strategic aspirations of becoming Africa’s Gateway to the world in line with our vision to be the World’s Most Respected African bank.
These transactions will significantly strengthen our presence in Southern Africa and further our footprint for growth in the SADC region.
With a broader presence across the continent, Access Bank will be better placed to support our customers who are increasingly looking towards intra Africa growth.
The proposed transactions will accelerate the Bank’s momentum towards delivering world-class banking services to an expanded customer base across Africa. Our goal remains to reach and impact 100 million unique customers across the continent by 2022. “
Over the years, Access Bank has evolved both in innovativeness, prestige, and strength.
The bank currently holds the position of the number one retail bank in Africa with a customer base of over 40 million.
They’ve relentlessly upheld their ‘more than banking’ promise which has inarguably given them an advantage over their competitors.
The Bank employs over 28,000 people in its operations in Nigeria and has subsidiaries in Sub- Saharan Africa and the United Kingdom (with a branch in Dubai, UAE) and representative offices in China, Lebanon, and India.
ICIJ Fingers Western Union, MoneyGram as Conduits to Launder Criminal Cash
International Consortium of Investigative Journalists (ICIJ) has uncovered how companies like Western Union and MoneyGram play a hidden role in laundering cash from around the globe.
In May, the International Criminal Court ruled that Jean-Pierre Bemba Gombo, former vice president of the Democratic Republic of Congo, will not be compensated for spending more than a decade in detention on war crimes and other charges mostly overturned on appeal.
He will not be reunited with his planes, villas and river cruiser, nor will he receive the $77 million he asked for in compensation.
After 12 years and more than 100 witnesses, history now records just one judgment of guilt: that Bemba bribed witnesses using Western Union and MoneyGram International, the world’s largest money transmitters.
Bemba and his allies, the court found, offered soldiers and civilians $100 or more — and in some cases relocation to Europe — to lie in Bemba’s trial.
In 2002 and 2003, Bemba commanded 1,500 Congolese soldiers who intervened in a conflict in the neighboring Central African Republic.
His forces killed civilians and raped women and girls as young as 10, victims and other witnesses later claimed.
The ICC found Bemba guilty of war crimes, crimes against humanity and witness tampering in 2016. The first two charges were overturned on appeal in 2018.
The bribery conviction held up.
A leak of U.S. government banking records reveals new details about the alleged payoffs — and the role Western Union played in them.
Bemba and four aides, also convicted of bribing witnesses, sent more than $429,000 through Western Union from 2005 to 2015, according to a suspicious activity report submitted by Western Union to the Financial Crimes Enforcement Network, a division of the U.S. Treasury Department. It is unclear how much of this money was used for bribes.
The suspicious activity report cites hundreds of recipients in 23 countries and names three people who have not been identified before, including one of Bemba’s key allies, Narcisse Arido, who received nearly $30,000 through Western Union, according to the report.
The Western Union report is also notable for its timing.
Financial institutions are required to regularly examine transactions and accounts for signs of money laundering and other types of financial crime.
Western Union didn’t file the suspicious activity report, or SAR, describing the payments until 2015 or later — at least seven years after Bemba’s arrest.
The undated Western Union document is one of more than 2,600 records obtained by BuzzFeed News and shared with the International Consortium of Investigative Journalists as part of the FinCEN Files investigation.
The reporting team found that banks, money transmitters like Western Union and other financial institutions have moved vast amounts of money for people accused of corruption and other crimes, often long after allegations were first made public
Bemba’s money flows are among suspicious transfers worth at least $150 million that went through Western Union and MoneyGram between 2005 and 2017, according to an ICIJ analysis of transactions from the FinCEN Files.
The two companies filed or were cited by other financial institutions in 236 suspicious activity reports, according to ICIJ’s analysis. Suspicious activity reports reflect the views of banking professionals and are not themselves evidence of criminality.
Payments through money transmitters, while often small, are central to modern crime. The FBI counts such payments as the third most common method to launder money, after bank transactions and payments in hard cash.
Recent cases in which money transmitters allegedly played a central role include several involving opioid trafficking rings and the crime rampage of a violent Eurasian mobster.
“Certain money transfer companies have repeatedly demonstrated a readiness to provide essential support to criminals and terrorists,” said David Pressman, an attorney suing Western Union, MoneyGram and two Russian banks on behalf of families of victims killed by Ukrainian separatists who shot down Malaysian Airlines flight MH17 in 2014.
“The business model is predicated on moving cash fast, at a global scale, even when it means moving cash to those intent on carrying out murderous acts.”
Big guys and little guys
The amount of money that Western Union, MoneyGram and other money transmitters send worldwide in a year exceeds the gross domestic product of Switzerland or Saudi Arabia. More than $689 billion was sent in 2018, the last year for which figures are available.
While remittances — especially transfers to relatives — are a crucial source of income for many people, especially in poorer countries, crime agencies say drug and human traffickers, fraudsters and arms smugglers push money around the world through the same companies.
The Financial Action Task Force, an international network of government anti-money-laundering agencies, found that many criminals avoid banks because they see money transmitters “as offering less risk of detection.”
Money transmitters are hard to monitor; there are 23,968 companies in the United States alone that fall under the technical term “money service business.” They are based at post offices, banks, liquor stores, Walmarts and gas stations. They range from behemoths like Western Union to a three-person outfit in Pago Pago, American Samoa.
Like banks, American money transmitters must report suspicious activities to FinCEN, the U.S. agency that oversees the fight against financial crime. Yet officials acknowledge that they catch little of the illicit money that passes through money transmitters.
Criminal exploitation of money transmitters is one of the “most significant vulnerabilities” in the United States, according to the Treasury Department’s 2020 report on the national strategy to counter illicit finance. There are simply not enough auditors to monitor the industry, the strategy paper said.
In the vast money transmission sector, the FBI calls MoneyGram and Western Union the “Big Guys.”
The big guys have a big rap sheet.
In 2012, the U.S. Justice Department agreed not to prosecute Dallas-based MoneyGram, the world’s second-largest money transmitter, after its agents conspired with fraudsters to trick victims into sending money with false promises of lottery winnings and bargains.
“MoneyGram Agents knowingly entered false addresses, telephone numbers, and personal identification” and took fees for processing the frauds, the company admitted in a statement of facts filed in federal court.
To escape prosecution, MoneyGram agreed to create a system to spot and stop potential frauds, tie executive bonuses to compliance with the law and require every MoneyGram office worldwide to follow U.S. anti-money-laundering rules, among other conditions.
MoneyGram broke the agreement when its new anti-fraud system failed to prevent a substantial number of criminal transactions, according to the Justice Department. MoneyGram paid a $125 million penalty.
Citing MoneyGram’s “environment of fraud,” the Justice Department in 2014 took the unusual step of suing a senior executive. It accused the company’s chief compliance officer, Thomas Haider, of allowing criminals to use MoneyGram “to defraud innocent consumers and then launder the proceeds.” Haider settled and paid $250,000.
Western Union, headquartered in Colorado, operates in more than half a million locations worldwide, compared with MoneyGram’s more than 350,000 outlets.
In 2010, the company agreed to upgrade its anti-money-laundering systems and paid $94 million to settle charges that drug, human and weapons smugglers misused the company to move vast sums of money across the U.S.-Mexico border.
Seven years later, Western Union agreed to pay $586 million after a U.S. investigation found that the company enabled scammers to defraud hundreds of thousands of Americans who paid to claim prizes or job offers that didn’t exist. “Various Western Union agents were complicit in these fraud schemes, often processing the fraud payments in return for a cut of the fraud proceeds,” the Justice Department said in a news release.
A year later, New York state fined the company $60 million for, among other things, waving through cash for criminals in China. And in 2019, French officials fined the company for failing to alert regulators to suspicious customers in Afghanistan, Iran and Turkey.
Western Union told ICIJ that it would respond to questions. It never did; the company’s communications chief, Claire Treacy, did not return subsequent emails or phone calls.
MoneyGram proposed a phone conversation with ICIJ to “potentially help” with research. MoneyGram canceled the call and sent a written response in which the company declared that it had found “several statements to be completely baseless.” The company did not explain what it considered “baseless.”
“MoneyGram takes financial crime very seriously and does not tolerate unethical or illegal conduct,” the company said in a statement. MoneyGram “has invested tens of millions of dollars in our state-of-the-art compliance program” and “has among the lowest fraud rates in the industry,” it said.
Jean-Pierre Bemba’s detention in 2008 made global headlines after police in Brussels arrested him and the ICC asked African and European capitals to seize villas, cars, bank accounts and a Boeing 727-100.
The ICC, which was created to bring the world’s worst war criminals to justice, whisked Bemba to The Hague, where his trial opened in November 2010. He was charged with witness tampering three years later.
“Whiskey” was Bemba’s code name for Western Union and “Mike” for MoneyGram, according to wiretaps obtained by ICC prosecutors. “Never, never, never” should payments pass through a bank account, Bemba told one aide.
Bemba conspired with aides – all of whom were also convicted, including his defense lawyer and a member of the DRC parliament – to coach witnesses to pretend that they were soldiers and testify in Bemba’s favor.
During his trial, prosecutors alleged that Narcisse Arido, an expert witness for Bemba’s defense, lured Central African witnesses with the hope of asylum in Europe and “exploited the precarious personal situations of these witnesses, selling them the illusion that by testifying falsely for Bemba they would have a better future.”
Sometime after Oct. 12, 2015, Western Union filed a suspicious activity report to FinCEN saying an employee had “identified” news about Bemba on the ICC’s website. Western Union reported almost 2,000 transfers from 2005 to Oct. 12, 2015, that involved Bemba and accomplices.
Arido, for example, received $28,732 from 30 Western Union branches in seven countries, according to the suspicious activity report. The ICC had issued a warrant for Arido’s arrest at least a year and 10 months before Western Union submitted its report to FinCEN.
The Western Union report indicates that Arido sent payments to three people in Cameroon and France: Arlette Josiane Tongui Bengue, Louis Kotys and Sylvie Ngo Manding. The average transaction was worth less than $300. It is unclear whether the payments were part of the bribery scheme.
Kotys and Ngo Manding could not be reached. Tongui Bengue, who now lives in Quebec, refused to answer questions when contacted.
You don’t need Western Union or banks to “go around and threaten a witness with a monkey wrench,” said Robert Cryer, a law professor at the University of Birmingham in England. “But money is central to other forms of witness intimidation.”
In a WhatsApp call with ICIJ, Bemba denied bribing witnesses. “No, that is absolutely false,” Bemba said. “I was not in a position to do it.” He has appealed the rejection of his compensation request.
From drug dealers to the godfather
From bustling metropolises like Tokyo to the world’s smallest capital city, Ngerulmud in Palau, Western Union’s black and yellow logo or MoneyGram’s white arrow can be found almost everywhere. For a fee, the companies offer an easy way to wire money to a loved one in a panic or to seal a business deal on a deadline. They play an essential role in the lives of tens of millions of people who use their services, from vice presidents to journalists.
While a bank-to-bank transfer can take days, both companies claim to make cash available “within minutes.”
There’s no stopping all illicit money transfers, especially those involving small dollar amounts and people not known to law enforcement.
But financial institutions are supposed to be on the watch for people like Anthony Gomes and his cronies.
Gomes and others helped introduce the potent opioid fentanyl to the U.S., routing the drug from Chinese laboratories to American dealers and users through the postal system. More than 36,000 Americans died last year from overdoses of fentanyl and similar synthetic drugs.
His trafficking ring hid transactions through offshore accounts and wired money through Western Union, according to court documents.
The records show that he and others sent $17,600 to China in one month alone via the money remitter.
“I have the guy on the way to wu [Western Union] now give me a few,” Gomes emailed another dealer, according to court records. “Ok good stuff,” the fentanyl dealer replied. “New batch is even stronger than [the] last.”
At least four Americans, including 19-year-old Daniel Latjerman in North Dakota, were killed by fentanyl imported by Gomes’ ring, prosecutors said. Gomes pleaded guilty in 2018 to conspiracy charges related to drug trafficking and money laundering.
Gomes and eight others appear in a spreadsheet included with a suspicious activity report in connection with more than $403,000 in payments made via MoneyGram from 2012 to 2017. Also named in MoneyGram’s undated report was Darius Ghahary, a northern New Jersey man charged in 2014 with manslaughter after Latjerman died. Ghahary died in custody. It is unclear why MoneyGram filed the report when it did.
MoneyGram helped move money for Ghahary despite his well-publicized conviction for internet fraud more than a decade earlier.
Money transmitters are one of “two key payment systems which support illicit procurement of opioids,” the assistant director of the U.S. Immigration and Customs Enforcement told Congress in 2018. Just a few months earlier, an undercover agent of the U.S. Drug Enforcement Administration told a federal court that he received fentanyl in a box marked “peanuts” after wiring $80 to China via MoneyGram.
Last year, the Treasury Department alerted financial institutions to the potential abuse of money transmitters in fentanyl and synthetic opioid trafficking.
The FinCEN Files show that one of America’s most dangerous Eurasian mafia dons built his empire with help from money transmitters.
In 2018, Razhden Shulaya, a Brooklyn tow-truck-leasing company manager, was convicted in New York of masterminding “a vast and violent criminal enterprise” involving gambling, credit card fraud, contraband cigarettes and stolen chocolates. Authorities said he also had plans to defraud casinos with rigged slot machines.
Shulaya was a “thief-in-law” the Russian equivalent of a godfather, U.S. prosecutors said. “He used his power to steal, defraud, extort and disfigure.” They cited occasions when Shulaya pistol-whipped his nephew and battered the face of a lieutenant after a perceived insult. Members of his gang beat enemies with pool cues. Others, to curry favor, gave Shulaya a Mercedes and a crossbow as gifts.
Shulaya is serving a 45-year prison sentence in West Virginia. He has appealed his conviction.
Two years before Shulaya’s conviction, FinCEN reported that an “associate” named George Meskhishvili sent $12,600 from Western Union locations in New York City to eight people, including Shulaya.
The agency’s report called Meskhishvili one of the possible “central facilitators” in the financial networks of Eurasian crime gangs. Meskhishvili has not been criminally charged.
FinCEN said the transactions were suspicious because many amounts were below the $10,000 threshold that banks must report in currency transactions, or were sent on the same or consecutive days.
In May 2014, Meskhishvili wired $1,200 from Brooklyn to Shulaya at the Bellagio hotel and casino in Las Vegas weeks before the U.S. launched its investigation. By the time Western Union approved Meskhishvili’s payment to Shulaya, the thief-in-law had previously been arrested in Europe during a high-profile anti-mafia crackdown. Shulaya was also wanted in Russia on unspecified charges, according to U.S. prosecutors.
ICIJ was unable to reach Meskhishvili for comment through social media or his last listed address in Brooklyn.
Asked five times why it approved payments to Shulaya, Western Union never replied.
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