- Olugbenga Agboola, co-founder and CEO of Africa’s largest fintech company, Flutterwae fintech, purchased a Miami beach house valued at $7.1 million.
- Flutterwave’s raised $250 million in February 2022 at a valuation of $3 billion making it one of the few unicorns in Africa.
- The fintech has faced legal and regulatory hurdles in Kenya including the freezing of $40m held by Flutterwave on money laundering allegations.
Olugbenga Agboola, co-founder and CEO of Africa’s largest fintech company, Flutterwae fintech, purchased a Miami beach house valued at $7.1 million. This purchase raises various questions after the Nigerian fintech company was allegedly hacked resulting in a $4.2 million loss.
Business Insider Africa reported tha Agboola had purchased a six-bedroom, seven-bathroom house in Miami beach. According to official records, the property was previously owned by the Boschetii Group, a real estate development firm. They purchased the plots for $1.2 million in 2021 and built a luxurious house.
Despite its new frame, the house demanded a hefty price reflecting the recent trend of skyrocketing demand and prices for South Flordia’s real estate. In addition, the COVID-19 pandemic significantly contributed to its appreciating price due to the spurred migration of families to the area. Thus, increasing the demand for non-waterfront property.
The price did not deter the man behind Africa’s largest fintech company. Despite this, he fully paid the whole amount without. Many attribute this feat as a representation of Flutterwave’s success which raised $250 million in February 2022 at a valuation of $3 billion making it one of the few unicorns in Africa.
Since the FTX crash, Africa’s fintech industry has suffered a significant blow. More users question the legitimacy of big companies utilizing blockchain technology. This places into prospect the rater timely manner o the entire event.
According to experts, a financial security breach occurred last month without the company realizing it. Hackers conducted 63 transactions between 28 accounts in early February. The actors ensured that the transactions did not raise any flags or suspicion. Thus consistently shifted funds between the compromised accounts.
As Africa’s largest startup, it was only a matter of time before hackers turned their attention to its lucrative transaction volume.
Allegedly, Futterwave filed a motion to freeze accounts across 27 financial institutions that interacted with the compromised account. According to police investigations, this legal move allows their team to pinpoint where the amount was finally withdrawn and shed light on possible leads.
Ever since the Nigerian fintech company announced this ordeal, several questions have surfaced regarding the alleged hack and have provided crucial insight into what happened. The decision to freeze any related accounts has led to a significant uproar among users.
According to TechPoint Africa, the move affected 107 accounts including the fifth beneficiaries of those accounts, which will be placed on lien/Posy-No-Debit(PND). These directives restrict many mentioned customers from withdrawing or transacting funds from their accounts.
Unfortunately, the cause and method that conducted the financial security breach are still unknown. Although many have speculated that the breach is a result of poor implementation of its blockchain technology. This assumption may hold some weight since blockchain technology is susceptible to breach if implemented poorly or through social engineering. One of the few online commentaries suggests that social engineering caused the hack. Thus the assailant could have acquired a valid user’s key by tricking legitimate customers. Flutterwave has however denied that its security system has been compromised.
Is it all connected?
Since the FTX crash, several industries within the crypto ecosystem and the fintech industry have experienced a significant drop in clientele. With blockchain technology redefining the financial system, its new nature has been its undoing.
Vulnerabilities within the system have consistently plagued its operations allowing malicious actors to gain access. Unfortunately, as the years progressed and as cyber security in various businesses has improved, so did the sophistication of scammers ad hackers. The FTX scandal was a crucial reminder that scammers today might be the very prominent organizations claiming to be secure.
Despite its success as a unicorn startup, the Nigerian fintech company has had a series of hurdles throughout its journey. Aside from the financial security breach, it also faces regulatory obstacles in Kenya. According to Kenya’s central bank, Flutterwave lacked several crucial security licenses.
Additionally, a Kenyan court in 2022 froze Flutterwave’s accounts on money laundering charges. However, the charges were later dropped though the Central Bank of Kenya has refused to associate with the Nigerian fintech Company if they won’t acquire the necessary documentation.
These challenges merely put into question the associations within Flutterwave. Although the company has shown its success, many are still sceptical about its associations. Some claim that Fluterwave is denying the allegations to save face and prevent users from exiting the platform.
Meanwhile, the affected accounts that are under investigation are still frozen and no further comment was made from the authorities or the Nigerian fintech company.