Trouble is brewing in financial technology (fintech) start-up, Palmpay Ltd, following allegations of disregard of Nigerian labour laws, funds round tripping and other suspicious dealings by the firm’s Chinese shareholders.
Insiders told our correspondent that the Chinese owned firm is also the subject of an ongoing police probe of its financial activities surrounding its Cash Mama Loan App.
A Palmpay Ltd staff, who spoke in anonymity, said the police investigation followed information leaked by a whistle-blower, alleging amongst others that the Cash Mama App was never sanctioned by the firm’s Board of Directors.
Her claims were strengthened by an independent investigation by our correspondent which showed that some Palmpay staff were indeed invited by the police.
Investigations also showed that apart from the labour malpractices, the firm’s Chinese shareholders unilaterally control Palmpay’s finances, without any accountability to the Board and regulatory agencies.
The source said some of the questionable actions of the Chinese, as uncovered by the whistle-blower and later confirmed after an investigation, included that the minimum share capital of the company had been eroded and depleted by the Chinese shareholders who, upon obtaining a license in Nigeria, proceeded to roundtrip the funds to obtain similar licenses in Ghana.
There have also been several allegations of mismanagement of the finances of the company by the Majority shareholders and diversion of funds to other businesses.
“I am aware that some of the (Nigerian) Directors on the Board are opposed to actions of the Chinese shareholders”, the staff said.
It was gathered that the Chinese shareholders recently attempted to remove the directors who dared to oppose their suspicious dealings. This attempt was, however, resisted by the Board of Directors who have vowed to expose all infractions by the Chinese.
Our investigations also unearthed a rumour that some of the Nigerian directors may have petitioned the regulators, but this was yet to be confirmed as at the time of this report.
Attempts to reach out to some of the alleged Nigerian Directors in order to ascertain whether they are truly Directors of the Company, was unsuccessful.
Our source also stated that there were other issues brewing in the company.
She said they were mostly connected to the high handedness of the firm’s Chinese majority shareholders -who are managing the affairs of the company without any regard to regulatory agencies.
It was gathered that the Chinese, most of whom are not resident in Nigeria, are said to have no regard for Nigerian labour laws.
The witness recalled a September 2020 publication by The Africa Report which accused a Chinese firm of unfair labour practices, adding that its officials were “racist and they engage in bribes”. According to her, this was a trend amongst Chinese companies or companies being managed/run by the Chinese.
The witness said this was also commonplace in Palmplay.
She also complained that so many companies, related to the Chinese, operate from Palmpay’s office and the staff of Palmpay also work for those companies, possibly infringing Nigerian labour laws.
“On a daily basis, new Chinese employees resume at Palmpay secretly and it is highly doubted if this influx of Chinese nationals have been sanctioned by our Nigerian Immigration as most of them are clerical staff and do not engage in any specialised or skilled work.
The work conditions in the company, according to our source, are deplorable and below the minimum standard permitted in Nigeria.
It was also alleged that at Palmplay there is no reporting line to Nigerian managers as the employees report to faceless Chinese individuals who do not reside in Nigeria and are not subject to Nigerian security and regulatory agencies.
Comments