Kenya Insights

Tag: MasterCard

  • MasterCard and I&M Bank Sued for Sh 20 Billion by Customers in Rwanda

    MasterCard and I&M Bank Sued for Sh 20 Billion by Customers in Rwanda

    Users of a Multicurrency Card issued by I&M (Rwanda) on behalf of MasterCard move to East Africa Court of Justice seeking compensation.

    Global payment company MasterCard and a regional bank I&M are being sued, alongside the Rwanda government, for USD 139 million (KES 20.1 billion) by 150 Rwandese cardholders who claim they were arrested and detained without trial and their cash and personal property confiscated following “false accusations” of bank fraud, money laundering and false enrichment.

    The applicants have filed the suit before the East Africa Court of Justice (EACJ) based in Arusha, Tanzania seeking a declaration that their arrest and detention by Rwanda Investigation Bureau infringed on their constitutional rights.

    In the suit filed by Ssemakula Ali Abaas and Nyinawumuntu Leatitia on behalf of the 150 other users of the Prepaid Mastercard Multicurrency Card issued by I&M Bank (Rwanda).

    The applicants are represented by Joseph McDonald of McDonald and Company Advocates of Nairobi, Kenya.

    “The dispute at hand centres on a group of Rwandan Citizens/Residents who entered into a Bank/Customer relationship with I&M Bank Rwanda PLC when the bank issued them with a Mastercard Multi-Currency card,” said McDonald, a Kenyan advocate.

    The Card could hold up to 17 different currencies and one of the benefits as advertised in the bank’s website was that a card holder could shift one currency to another within the card’s sub-wallets.
    Said McDonald.

    “A comparison between the rates offered by the bank and those on the MasterCard platform revealed that the latter offered favourable rates. The group would then develop the practice of shifting currencies within the card’s sub-wallets i.e. from AED to EURO and back to AED, resulting in a 10% profit. This activity essentially leveraged price differences across markets, a practice known as arbitrage. As a matter of fact, I&M had run a commercial advertisement that gave customers 10% discount on the usage of their multicurrency card.”

    On or around January 2023, the Rwanda Investigation Bureau arrested the over 150 individuals on allegations of bank fraud, money laundering and illicit enrichment.

    The applicants according to documents seen by Kenya Insights claim that they were detained without trial for more than three months, were denied bail, were extorted/ forced to transfer money to escrow accounts, their properties confiscated and their family members and friends were also detained and tortured to give information.

    Below are some of the suit’s documents:

    [pdf-embedder url=”https://cms.kenyainsights.com/wp-content/uploads/2024/02/IandMsue.pdf”] [pdf-embedder url=”https://cms.kenyainsights.com/wp-content/uploads/2024/02/Statement-of-Reference.pdf” title=”Statement of Reference”] [pdf-embedder url=”https://cms.kenyainsights.com/wp-content/uploads/2024/02/List-of-documents.pdf” title=”List of documents”] [pdf-embedder url=”https://cms.kenyainsights.com/wp-content/uploads/2024/02/1st-Applicant-Abassa-Affidavit.pdf” title=”1st Applicant-Abassa-Affidavit”]

  • I&M Bank, MasterCard Accused Of Extortion In Rwanda

    I&M Bank, MasterCard Accused Of Extortion In Rwanda

    Global payment company MasterCard, local I&M Bank and Rwandese government have been dragged to the East Africa Court of Justice (EACJ) over allegations of extortion, illegal detention and torture of 150 cardholders without trial and gross violation of human rights.

    In a class-action lawsuit filed by two individuals, a Ugandan and a Rwandese, on behalf of 150 other users of the multi-currency card at the Regional court, MasterCard, I&M and Rwanda Investigation Bureau are accused of complicity in the arbitrary arrest, detention, extortion and torture of users of the MasterCard Multicurrency Prepaid Card.

    The applicants namely Ssemakula Ali Abaas and Nyinawumuntu Laetitia who are being represented by Kenyan law firm McDonald and Company Advocates contend that on or around January 2023, Rwanda Investigation Bureau (RBI), an investigation organ of the Rwandan government, arrested and detained them together with other over 100 Rwandese residents who were customers of MasterCard/I&M for more than three months without trial. The RBI officers extorted from them, confiscated their property and denied them without bail.

    According to the lawyer, all the victims who were clients of MasterCard/ I&M as users of the MasterCard Multi-currency Prepaid Card issued by the I&M Bank have been detained in Rwanda without trial over alleged banking fraud, money laundering and illicit enrichment.

    “The dispute at hand centres on a group of Rwandan Citizens/Residents who entered into a Bank/Customer relationship with I&M Bank Rwanda PLC when the bank issued them with a Mastercard Multi-Currency card,” said McDonald, a Kenyan advocate.

    It is alleged that between November 2022 and January 2023, I&M Rwanda issued the Prepaid MasterCards to the victims.

    The card allowed the holders to hold up to 17 different currencies in different wallets on the same card. It is said that the card also allowed the holder to pay for goods and services from merchants displaying the sign corresponding to that appearing on his or her card.

    “One of the benefits as advertised in the bank’s website is that a card holder could shift one currency to another within the card’s sub-wallets. A comparison between the rates offered by the bank and those on the MasterCard platform revealed that the latter offered favourable rates,” Abaas and Laetitia state in their affidavits filed in court.