The US Securities and Exchange Commission (SEC) has filed a lawsuit against Tingo Group, a financial technology company, accusing it of engaging in an extensive and “staggering” fraud by overstating its financial results. The SEC claims that Tingo, along with its related companies Tingo International Holdings Inc. and Agri-Fintech Holdings Inc., conducted billions of dollars in false transactions through two Nigerian subsidiaries since 2019. The lawsuit, filed in federal court in Manhattan on Monday, alleges that Tingo reported hundreds of millions of dollars in fake revenues and assets.
The SEC specifically names Tingo’s chief executive officer, Mmobuosi Odogwu Banye, as the orchestrator of the alleged fraud. The lawsuit reveals instances where Tingo reported a cash balance of $461.7 million in March, while legitimate bank records showed less than $50.
This legal action follows a June report by short seller Hindenburg Research, which claimed fraudulent activity by Tingo, leading to a 48% decline in its share price. The SEC contends that Tingo not only persisted in its alleged falsehoods but also continued fabricating results in public filings after the short seller’s report.
Tingo, a company providing a smartphone-based platform for African farmers, faces further accusations related to the sale of Tingo Mobile, a Nigerian company through which the SEC asserts the fraud originated. The complaint alleges that Mmobuosi pushed for the sale of Tingo Mobile to two public companies based on grossly inflated valuations exceeding $1 billion.
According to the SEC, these misleading valuations created a false impression of Tingo Mobile’s financial health, causing a significant overvaluation of the companies’ shares and Mmobuosi’s controlling stake. The SEC accuses Mmobuosi of reaping millions of dollars in illicit profits through illegal insider sales of shares obtained through mergers and misappropriating Tingo Group’s assets for personal expenses, including luxury cars, private jet travel, and an unsuccessful attempt to buy an English soccer team.
As the legal proceedings unfold, the case highlights the regulatory scrutiny surrounding financial misstatements and fraudulent activities, particularly in the technology and financial sectors. Tingo Group and Mmobuosi Odogwu Banye are now facing serious allegations that could have significant repercussions for the company and its leadership.
