Nigerian payments fintech company Flutterwave has been trending in the news in recent weeks and this has not been for reasons relating to a financing round or for being Africa’s most valued startup. The startup has been in the news for quite notorious reasons. For the startup, the month of April began with allegations from a former employee that she had suffered harassment from Flutterwave’s CEO –Olugbenga “GB” Agboola, for the five years she worked at the company.
The former employee, Clara Wanjiku, via a Medium Post called out the startup’s CEO on claims of harassment. Before quitting in 2018, she was Head of Implementation at the company. Her grievances were that she had been harassed by the company’s CEO for five years and that she had not been paid her “dues.” She went ahead to sue the company.
The former head of implementation was accused of being behind a Twitter account calling out male employees of Flutterwave over sexual allegations. She also blamed Olugbenga “GB” Agboola for sabotaging her opportunity to work with a Nigerian bank – the startup’s executive described her as a bad employee, she said.
According to her, following her announcement to sue the company for not settling her, she received a call from a Flutterwave staff asking her to settle out of court, and the matter has been resolved amicably.
She also sued the startup for failure to remove her as the contact person for their M-Pesa account which caused her and her family to be arrested after a fraudulent transaction was discovered by the police. She was awarded a settlement of $2,500 which she didn’t agree to after demanding compensation for damages of $900,000.
We thought that was the end of the storm for the biggest African startup. Little did we know that there was more to come…
A can of worms seems to have been opened following the brouhaha between Clara Wanjiku and her former employer.
Earlier this week, a story containing allegations against Flutterwave’s CEO ranging from insider trading to the creation of false identity, fraudulent practices, abuse of power, and what have you made the rounds.
The post, published by West Africa Weekly and written by independent journalist David Hundeyin on the 12th of April 2022 described Flutterwave as a payments mafia with its CEO as the head of this mafia group.
Let’s examine these claims closely
Flutterwave’s CEO Olugbenga “GB” Agboola was accused of creating a false identity to get more shares than was agreed upon and also manipulating stock. The identity he allegedly created is known as Greg Agboola. The agreement was that Adeleke Adekoya, one of his partners, was to receive 37.5 percent of the company while the remaining 62.5 percent was to be shared between him and the company’s CEO Iyinoluwa Aboyeji. The CEO was said to have told his partners that Greg Agboola was to receive 10 percent of the company which would be cut out of the holdings of his other partners – Adeleke Adekoya and Iyinoluwa Aboyeji.
Olugbenga “GB” Agboola was also accused of refusing to hand over 40,000 shares, worth almost $2 million, as agreed with an employee while other employees that received theirs got it at a low value of $3.50 compared to the market value of almost $20 being received by investors. Then again, employers can only sell these shares to an investment vehicle that is owned by the CEO, David Hudenyin’s report said. This leaves one to think that there is something fishy going on at the company…
The Flutterwave CEO was also accused of abusing power and double-dealing. Before Flutterwave, Olugbenga “GB” Agboola was the Head of Digital Factory and Innovation at Access Bank. He was accused of using this position to favor Flutterwave during meetings with investors. As seen on his LinkedIn page, the CEO left the bank in 2016 but there are claims that he went on portraying himself as a member of the bank afterward without the banking being aware of this.
A discovery made it known that although he claimed that he left Access Bank in 2016, he was still a member of the bank as of 2017 and 2018 according to official documents that had his name and signature.
Insider Trading allegations
The CEO has therefore been accused of double-dealing. Flutterwave is a Nigerian and US-based company with its stock being traded privately. Per the US SEC rules, ‘insider trading’ applies to the company. Olugbenga “GB” Agboola’s crime could carry a penalty of up to 20 years imprisonment in the US if found guilty of deliberately underpricing employees’ stock and subsequently buying back these underpriced stock.
The US SEC has probed both Flutterwave’s CEO and its former CEO Iyinoluwa Aboyeji for insider trading. At their SEC hearing, however, both claimed that the company’s CEO never worked simultaneously for Flutterwave and Access Bank. Further investigations are expected to take place.
David Hundeyin’s report also claims that different employees had different stock contracts and that the prices at which these stocks could be sold were not included in these varying contracts. They also could only be sold to an investment vehicle owned by Flutterwave’s CEO.
The report also had other claims against Flutterwave and its CEO and went as far as dragging legal firm Banwo and Ighodalo for asking a client, an employee called Jennifer, to drop a case against the company after earlier advising her to take up the case.
The report also accused Flutterwave investors of paying deaf ears to some of these accusations and claimed that investors were aware of some of them.
At the end of the day, the recent happenings at Flutterwave leave one wondering if the most valued African startup is just a charade or probably a good cause that’s, unfortunately being led by a leader ought for making selfish and personal gains. Or as described by David Hundeyin, Flutterwave could just be an African startup built on quicksand, and let me add favoritism, unethical practices, poor employer-employee relationships, office politics, and what have you.