Ecobank Kenya suffered significant financial losses, amounting to millions of dollars, between 2020 and 2022 due to weaknesses in its card operations system. An internal investigation, conducted by a task force in 2023, uncovered major flaws in the bank’s processes, allowing for fraudulent activities by both merchants and staff.
The report revealed that $43.4 million was erroneously posted within the bank’s system, and $232,464 was lost due to chargeback failures. Additionally, $162,346 in transactions was rejected by payment providers like Mastercard, exposing further vulnerabilities.
The task force noted that poor oversight, manual errors, and a lack of documented procedures contributed to the problem. Significant gaps in staff training worsened the situation, leading to undetected discrepancies for nearly two years. The report also identified a suspicious $2.1 million balance without supporting documentation, raising concerns of potential fraud.
Ecobank Kenya has yet to respond to inquiries regarding the losses. The investigation highlighted weak internal controls, including a deficient maker-checker process and flawed transaction monitoring systems, which allowed these issues to persist. The failure to upload transaction source documents on time and duplicate entries also complicated efforts to reconcile the bank’s accounts.
Despite attempts to rectify the situation, including uploading delayed transaction files, the bank’s card operations continued to face challenges, resulting in substantial financial losses during this period.
