Kenya: Safaricom Dismisses 33 Employees Over Corruption and Fraud Allegations

Safaricom, Kenya’s leading telecommunications company, has announced the termination of employment for 33 staff members due to allegations of corruption and fraud during the fiscal year ending in March 2023. This figure represents the highest number of dismissals in the past four financial years, raising concerns within the company.

In the preceding fiscal year ending March 2022, Safaricom had dismissed 24 employees as part of its ongoing efforts to combat corruption. While this was a decrease from the 28 employees dismissed the year before, the recent increase to 33 dismissals is drawing attention.

Out of the 33 cases, 14 were related to Sim Swap incidents, a notorious issue in Kenya that often results in financial losses for victims. Another 17 cases involved violations of company policies and procedures, while 2 cases were linked to asset misappropriation, a form of employee fraud where company or client assets are misused for personal gain.

Safaricom took action by forwarding 9 of the investigated fraud cases to law enforcement agencies, marking the highest number of such cases in the past four years. This demonstrates the company’s commitment not only to addressing internal corruption and fraud but also to cooperating with external authorities.

Despite these challenges, Safaricom reported zero cases related to data privacy breaches in the past year, reflecting an improvement compared to two years ago when the company investigated 22 cases of data privacy breaches.

Safaricom, which employs just over 5,000 people, acknowledges that while 33 dismissals are concerning, they represent a relatively small proportion of their workforce. The company has been actively providing ethics training to its employees, with 98% of staff benefiting from such programs.

“Training, both internally and externally, helps to promote our ethical culture. As indicated in the table, a total of 98% of our staff benefitted from ethics training, and the entire Board was trained on Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT),” Safaricom stated in its latest report.

In the past four years, Safaricom has provided ethical training to 72,063 of its 270,360 M-Pesa agents, demonstrating its commitment to maintaining high ethical standards among its partners and employees.

Earlier this year, Safaricom partnered with the Directorate of Criminal Investigations (DCI) to investigate M-Pesa fraud cases, showing its determination to combat fraud not only within the organization but also in its broader ecosystem. Initiatives such as social media campaigns, text messages, and “Jitambulishe” have been launched to raise awareness about fraud among Safaricom’s users. The company also hinted at upcoming security enhancements, including obscuring M-Pesa pins during entry, which was mentioned during an investor briefing in May.

While Safaricom has not publicly disclosed specific monetary losses associated with these fraud cases, it is important to recognize that fraud can have financial implications beyond immediate losses. These may include legal expenses related to investigations, implementing enhanced security measures, and potential long-term revenue impacts due to erosion of customer trust.

Stakeholders will closely monitor Safaricom’s future financial disclosures to assess the extent of these implications and the company’s strategy for addressing them, as it seeks to safeguard its financial stability amid internal fraud challenges.