Fraudsters invade the growing mobile phone money transfer sector

Kenya is grappling with an increase in mobile phone related crimes as the number of subscribers and users of money transfer services rise in the country.
Some people have been defrauded of their money through mobile transfers.
Some people have been defrauded of their money through mobile transfers.

Kenya is grappling with an increase in mobile phone related crimes as the number of subscribers and users of money transfer services rise in the country.

Con men have invaded the sector targeting mobile phone subscribers and money transfer service users, who according to the Communication Commission of Kenya (CCK) stand at 26.5 million and 18.4 million respectively.

For money transfer service users, perhaps it is the amount of cash transferred through mobile phones that is making criminals plot schemes to defraud subscribers.

In a quarterly report released in January, the CCK noted that from last April to June, subscribers transferred over 582 million dollars through mobile phones.

The amount rose to 683 million dollars from July to September, an increase of 58.6 percent compared to the same period last year when 430 million dollars was transferred. The figures indicate that mobile phones are increasingly becoming the tools of choice for sending and receiving money for many Kenyans.

“Continued growth is an indication of subscribers’ preference of mobile money transfer, which could be attributed to accessibility and affordability even to low-income earners who form the bulk of the unbanked population,” the CCK said in its report.

Con men are, therefore, eager to cash in on the boom. As such, at least every mobile phone subscriber and money transfer service user in Kenya has received a message or a call from unknown persons informing them they have won certain competitions.

What matters, however, is what one does after getting the message or call. On Jan. 7, Emelda Mungaria’s employee at a money transfer service shop in Migori, Western Kenya, received a call from someone purporting to be from Safaricom, a telecommunication company running M-pesa, a popular money transfer service.

The person informed her that the company was upgrading its M-pesa network therefore, they were asking subscribers to provide details of their accounts.

“She told me the person sounded genuine that she did not think twice while giving out the details. After divulging the information, my worker thought all was okay,” Mungaria said.

It was about 30 minutes later, when a customer came to withdraw money that the employee realized she had been defrauded. “She had 843 dollars in the account but when she tried to make the transaction, she was told she had insufficient funds.

It is then that she suspected foul play and called me,” Mungaria said. Mungaria attempted to trace the money by informing his mobile phone operator, Safaricom but was told it was too late and instead told to report the matter to police.

“I traveled there the next day from Nairobi and reported the matter but up to now I have not been able to get back the money. Police have been unable to assist me,” she said.

Martin Ngecha of Nairobi received a message informing him he had won over 12,000 dollars. “Congratulations, you are a winner of 12,000 dollars in the win Isuzu promotion. Do not call, SMS your name, location and age to this number so that we can countercheck the details,” the message said.

Ngecha decided to play along and send a text message to the number with a false name to see what would happen. “I was doing it because I thought it would cost me 0.01 dollars, which was negligible but I was wrong. After sending the message, I checked my airtime only to find I had nil balance, from 1.08 dollars. I could not believe it,” he said.

Since that day, Ngecha said, when he receives any message that appears fraudulent, he deletes it immediately. “I do not even think twice, I ignore or delete.

I got another recently that said ‘I have sent 75,000 dollars through Western Union. Kindly clear those materials from Japan. The containers have departed to Kenya. The secret word is Cornbag. Now I am in Tanzania.’ The message further asked me to call a certain number but I did not,” he said.

Data from Safaricom, Kenya’ s leading mobile phone service provider says that con artists have raked in over 120,481 dollars in the past five months from M-pesa users.

The company says the upsurge in fraud targeting money transfer users is because con men are taking advantage of some customers’ naivety. The company’s survey shows that most mobile phone fraud is orchestrated by prisoners in Kamiti, one of Kenya’s most notorious prisons.


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