- HabariPay mistakenly credited merchants twice
- The firm got a court order to mandate more than 40 financial institutions to restrict accounts that received those funds
- An insider alleged that the incident was the result of human error
In 2023, HabariPay, the fintech subsidiary of Nigeria’s leading bank, Guaranty Trust, mistakenly sent about N1.1 billion to thousands of customers. Now, it wants to recover every penny of that amount.
The bank wanted to use legal means to recover the funds, so it approached the federal high court in Lagos for permission to restrict the accounts. Recently, the court granted the bank its application to mandate more than 40 financial institutions to restrict accounts that received those funds.
How did GTB send N1.1b to thousands of customers erroneously?
The big question in industry circles is how did the error happen? How did HabariPay, a subsidiary of a big bank like GTB, make such a costly mistake?
According to insiders, the bank lost the money when HabariPay mistakenly credited merchants twice. Since the incident, efforts have been made to investigate the issue and track the funds.
Hackers gained access to the fintech's website by employing a tactic known as race conditioning, which enabled them to initiate multiple transactions at once, according to a TechCabal report.
According to a person with knowledge of the matter, HabariPay had started to retrieve part of the money before starting the legal process by getting in touch with retailers to reverse some of the transactions. An insider alleged that the incident was the result of human error.
With the court's nod, the affected accounts will be restricted, and efforts will be made to recover the funds. Affected merchants will be contacted and asked to return any excess money received before those restrictions are lifted.
“Any other account that benefitted or received the double credit transaction” will also be compelled to refund the extra money, the report quoted. The move is meant to ensure all of the funds are recovered.
The fintech reached out to the merchants it could reach and asked them to reverse the transaction but had to go to court to obtain an order to compel the merchant it could not reach to reverse the funds.
Inside story of how Chi Nnadi’s crypto exchange Mara crashed with investors’ $23 million
Meanwhile, TheRadar earlier reported that at the height of the crypto boom of 2021, a new crypto exchange called Mara (CoinMara Inc.) was born. Mara had a simple goal: be a pan-African exchange poised to “build Africa’s crypto economy.” Given that Web3 is set to take over the future and young Africans should not be left behind, the platform was well received and seen as one that would stay on for a long time.
Mara had a great team of founders, at least on paper: Chinyere ‘Chi’ Nnadi, Lucas Llinás Múnera, Kate Kallot, and Dearg OBartuin.
