Some illegal financial institutions operating on Opebi Road, Ikeja, Lagos has been shut for “possible violation” of consumer rights by the Federal Government.
It was learnt that the companies: GoCash, Okash, EasyCredit, Kashkash, Speedy Choice, Easy Moni – owned by Blue Ridge operate on the third floor of a four-storey building in the area.
The Federal Competition Consumer Protection Commission, in a joint operation with the Independent Corrupt Practices and other Related Offences Commission, National Information Technology Development Agency, and the Nigerian Police Force, raided these institutions.
According to the FCCPC, the raid was in response to customers’ complaints of malpractices by the financial institutions.
The Chief Executive Officer, FCCPC, Babatunde Irukera, explained that customers had accused the financial institutions of violating their privacy in their debt recovery drive.
Irukera said the agency had begun investigations into the allegations since 2020.
He said, “This information started quite a while ago. Some time ago, when the country was on lockdown in 2020 due to the pandemic, we started seeing the rise in money lenders”
“Because there was lockdown due to the pandemic, people needed small easy loan which is understandable. But over a period of time, people started complaining about the malpractices of the lenders, so we started tracking it.”
According to Irukera, the interest rate charged by online financial institutions appear to violate the ethics of how lending is done.
He explained: “The key two things that were subject of concern were what seems to be the naming and shaming violation of people’s privacy with respect to how these lenders recover their loans.”
“Secondly, the interest rate seems to be a violation of the ethics on how lending is done. So, those were the two things that we set out to look for.”
The FCCPC boss said investigations had revealed that the loan firms were neither Nigerian companies nor registered in the country.
“We found out that most of these companies operate from the same place. We also found out that many of them are actually operated by the same person.
“They are not Nigerian companies, they don’t have an address in Nigeria and they are not registered in Nigeria with the Corporate Affairs Commission and they do not have any licence to do their business,” he stated.
As a result, Irukare said the agency had written to global app companies asking them to suspend the operations of the online banks.
He said, “Essentially, what they have is an app, and so we started gathering more information about them. We engaged the public and the people who had been their victims. They gave us more information”
“As we got more information we had enough evidence to convince the court to issue a warrant for us to proceed with an investigation into a search and seizure. And sometime last month, a court issued a warrant, and between then and now, we were preparing a sting operation which is what you are seeing here today. The reason for this is because we wanted to be sure we are hitting at the place we could get many of them.”
He explained, “In addition to what you are seeing here today, the FCCPC has also issued multiple orders today. Two of them are going to vendors: Apple and Google stores where some of these apps are available. We have asked them to shut these companies’ apps down so that people will not be victimized anymore. Secondly, some of them (the orders) have gone to the bank, asking them to freeze the accounts used by these people.”
“I must add though that not all money lenders are operating illegally and that is why it has been taking time for us to track these people.
It doesn’t also mean that the people we are proceeding against today are the only ones, no. We want to start with them. We also understand that they are between five and seven companies operating at the same location.”