Court slaps Airtel, Standard Bank for aiding fraud
The High Court of Malawi Commercial Division has found Airtel Malawi plc and Standard Bank Malawi plc guilty of negligence and ordered the two to pay K120 million compensation to DBM Construction proprietor Billy Milimbo.
The court found the two listed companies liable in a case in which the claimant, Milimbo, a client at Standard Bank Capital City Branch in Lilongwe, was claiming a refund of K24 million he said was fraudulently cashed out by two fraudsters at two of Standard Bank branches in Blantyre.
Presiding Judge Ken Manda said it was beyond reasonable doubt that Airtel Malawi plc and Standard Bank Malawi plc had a role in the manner that Milimbo lost K24 million to fraudsters who cashed cheques from his account in his absence.
The alleged fraudsters are reported to have used two separate cheques at two Standard Bank branches after an Airtel SIMcard swap which was used to confirm cheque withdrawals.
Milimbo claimed the refund of the sum of K24 million plus compound interest on the said amount at three percent above the prevailing Standard Bank base lending rate.
He also claimed payment amounting to K71 890 000 being mobilisation and demobilisation costs for losses in his projects, including K3 600 000 as reimbursement of legal costs and costs of the action.
Airtel Malawi plc, as the first defendant, is a licensed provider of mobile services where Milimbo held his mobile phone number while the second defendant, Standard Bank plc is a commercial bank where the claimant holds an account.
Court documents show that on October 13 2019 Milimbo travelled to South Africa after giving instructions and authorisation to the bank to cash the three chques.
The court found that while the claimant was away and without his consent, Jackson Mhango, an agent managing a call centre on behalf of Airtel Malawi plc, gave personal details of the claimant mobile number to an unidentified third party.
The third party, the court learnt, proceeded to replace the claimant’s SIMcard in what is now commonly known as a SIM swap.
The court heard that on October 18 2019, the fraudsters cashed two cheques of K14.2 million and K9.8 million at Standard Bank Blantyre Branch from the claimant’s account.
Before cashing the cheques, the bank called the claimant’s mobile number for verification. The cheques were duly confirmed by the fraudsters who had by then swapped the SIMcard, making the bank to proceed to pay.
Milimbo argued that considering that he was out of the country and that the cheques were of huge amounts, it was imperative for the officers at the bank’s Blantyre Branch to verify the authenticity of the cheques with his local branch.
He also said he left specific instructions with his local branch that all other transactions had to be put on hold until his return.
The court ordered Standard Bank to pay the claimant K71 890 000 plus interest while the liability for the sum of K24 million plus interest, will be apportioned equally between the two defendants.
In addition, the court awarded the claimant K6 million as exemplary damages and the amount would be borne by Airtel Malawi plc for breaching their statutory duty towards the claimant.
