Court Instructs Safaricom To Refund Money Fraudulently Withdrawn From Customer’s Mpesa Account  

By The Weekly Vision

A landmark ruling was made in court last month against Safaricom PLC after the giant mobile phone service provider was ordered to refund Ksh. 452,868 which had been withdrawn from the Mpesa account of one Ronald Wilson Kafwa. Mr Kafwa had lost his mobile phone and took the necessary steps to block all the transactions but Safaricom failed to affect the request. It is suspected the fraudsters must have colluded with Safaricom staff to successfully withdraw the money.

In a ruling dated 21st June 2023 by Judge A.N Ongeri, Safaricom was found guilty and that their staff slept on their job. The ruling reads “The appellant owed the respondent a fiduciary duty of care to act with diligence after the respondent reported the loss of this telephone and took all the necessary steps to have all the transactions blocked. The ruling further reads “The appellant was in breach of the duty of care owed to the respondent and as a result, the respondent lost his money. It was further noted that “I find that there is no evidence that the respondent disclosed his pin to 3rd parties or that he was involved in the fraudulent withdrawals. I find that it was the duty of the appellant to ensure that the SIM card was blocked after the respondent reported the matter”.

Mr Kafwa had filed a statement of claim against SAFARICOM PLC seeking a refund of Ksh. 751,680, however, the trial court found that Safaricom was liable for the money he lost before making the report i.e. Ksh. 292,812 and judgment was entered in favour of Mr Kefwa against Safaricom for the difference i.e. Ksh. 452,869. Mr Kefwa who is the owner of phone number 0714****32 reported the loss of his phone and requested Safaricom call center to block his M-PESA account. However, since he was subscribed to the Advantage Hybrid Tariff, his request to block the M-PESA account could not be immediately processed, and he was advised to visit the nearest retail centre to affect this request.

Later that day, he visited Safaricom’s retail store on Moi Avenue and as he did not have proof of his identity, he was asked to get this or a police abstract. A total of Ksh. 298,812 had already been withdrawn at 2:09 p.m. from his MPESA account at an Equity Bank ATM before his M-PESA account was suspended. He presented the police abstract, after which his SIM card was blocked on 10th October 2021, at 2:00 p.m. On 11th October 2021, he requested the unblocking of his SIM card and after a successful verification, additional amounts of Ksh. 116,505/- were withdrawn from his MSHWARI account. On the same day, he requested a second SIM card block, and the same was affected after Safaricom verified his identity.

He submitted that the M-PESA statement revealed that a sum of Ksh. 418,331 was withdrawn from his M-SHWARI account. However, Safaricom claimed that they are not responsible for ensuring the security of M-SHWARI as this service is provided by NCBA Bank to its customers. It was discovered that Safaricom breached its duty of care when a fraudulent third party called its customer care representative pretending or purporting to be the Respondent, and Safaricom negligently permitted the unauthorized access without properly ascertaining that the person calling was the owner.

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