Liberia: MTN Mobile Money Fined Millions of Dollars By Liberia’s Central Bank For Non-Compliance With Regulations

MONROVIA — Lonestar Cell MTN Mobile Money Inc., one of Liberia’s largest mobile money companies, has been slapped with a massive fine of millions of Liberian dollars by the Central Bank of Liberia (CBL), the official regulator of all mobile money operations, for non-compliance with various regulations of the CBL.

In a sternly-worded letter addressed to the CEO of MTN Mobile Money, Mr. Rahul De, (a copy of which is in the possession of FrontPageAfrica), the CBL informed the company that it was being fined because of “continuous violations of CBL’s mobile money regulations and failure to conform to the minimum corporate governance requirements set by the CBL.”

However, rather than paying the fine and complying with the CBL directives, the CEO instead wrote to the CBL and appealed that the fine be waived.  In another letter (a copy of which is also in the possession of FrontPageAfrica), the CBL outrightly rejected the appeal and re-affirmed its directives that the fine be paid immediately and that the company should bring itself into compliance with the CBL regulations.  

The CBL further stated that since MTN Mobile Money became operational, it has been in continuous violation of the CBL regulations.

Through further investigation, FrontPageAfrica has confirmed that the fine has now been paid, but that the company has still not yet complied with the CBL regulations.  In the letter referred to above, the CBL has warned MTN Mobile Money that further failure to comply with the timelines given by the regulator could result in the imposition of additional penalties.

In a related development, FrontPageAfrica has learned that the local Liberian shareholders of MTN Mobile Money have sued the company in the Commercial Court of Liberia for non-compliance with their rights as shareholders.  As this lawsuit is now being litigated, FrontPageAfrica cannot comment further as the matter is now sub judice.

Flouting Government Regulations

This defiant behavior of the South African telecommunications giant in flouting and/or ignoring Government regulations is not limited to Liberia alone.  

They have done so in various West African countries where they operate, resulting in heavy fines and even shutdowns of their offices.   In Nigeria, for example, they have been fined billions of US dollars in recent years.  In October 2015, the regulator slammed MTN with a fine of N1. 04 trillion naira, equivalent to $5.2 billion US dollars at the exchange rate prevailing at the time, following their failure to cut off five million unregistered subscribers after a deadline set by NCC, in agreement with major telcos in the country.

In 2017 in Benin, their refusal to pay the regulatory fees due to the Government of Benin resulted in the expulsion of the MTN Benin CEO, Stephen Blewitt (now CEO of MTN Ghana) from that country.

Similarly, in January of this year Guinea’s Post and Telecommunications Regulatory Authority (ARPT) shut down MTN’s headquarters in Conakry.  According to local media reports, the Guinean regulator accused the mobile operator of non-payment of taxes, fees and license fees. 

Bullying and Marginalization of Local Shareholders

The Pan-African telecommunications giant also has a reputation for bullying and marginalization of local shareholders in various countries where they operate.  These local shareholders are now fighting back, through various litigations and appeals to regulatory authorities for redress and protection.  In Benin in recent years, the local shareholder had his rights trampled over so consistently that he had to bring a lawsuit against MTN in the British High Courts.   

In Cameroons, MTN has shown its unwillingness not only to pay regulatory fees to the Governments under whose licenses it operates, but also has the same attitude towards local contractors and professionals.

It remains to be seen whether the Central Bank of Liberia will allow MTN Liberia to continue to ignore its regulations, which have the force of law in Liberia, and continue to flout the public policy of the Liberian government regarding local content.