The U.S. Securities and Exchange Commission (SEC) has filed charges against Nigerian businessman Dozy Mmobuosi and three affiliated companies for allegedly lying about account balances as part of a multimillion-dollar fraud scheme.
The SEC announced the charges on Monday against Mmobuosi, also known as Banye Mmobuosi, the CEO of Tingo Group Inc., Agri-Fintech Holdings Inc. and Tingo International Holdings Inc.
Regulators allege Tingo Group falsely claimed to have $461.7 million in the Nigerian bank accounts of its subsidiary, Tingo Mobile, when the combined balances in all accounts totaled around $50.
According to regulators, the companies claimed the outsized account balances across 2018 and 2019 in public filings to give a false impression of financial strength while seeking to access U.S. markets for expansion.
In a statement, SEC said, “The SEC’s complaint, filed on December 18, 2023, alleges that, since at least 2019, Mmobuosi spearheaded a scheme to fabricate financial statements and other documents of the three entities and their Nigerian operating subsidiaries, Tingo Mobile Limited and Tingo Foods PLC. The complaint further alleges that Mmobuosi made and caused the entities to make material misrepresentations about their business operations and financial success in press releases, periodic SEC filings, and other public statements.
“For instance, Tingo Group’s fiscal year 2022 Form 10-K filed in March 2023 reported a cash and cash equivalent balance of $461.7m in its subsidiary Tingo Mobile’s Nigerian bank accounts. In reality, those same bank accounts allegedly had a combined balance of less than $50 as of the end of fiscal year 2022. According to the SEC’s complaint, Defendants also fabricated the customer relationships that formed the basis of their purported businesses.
“The complaint alleges that Mmobuosi and the entities he controls have fraudulently obtained hundreds of millions in money or property through these schemes, and that Mmobuosi has siphoned off funds for his personal benefit, including purchases of luxury cars and travel on private jets, as well as an unsuccessful attempt to acquire an English Football Club Premier League team, among other things.”
Tingo Group went public via merger with a special purpose acquisition company (SPAC) in 2021 at an estimated $1.7 billion valuation. Prosecutors claim thousands of U.S. investors have likely suffered losses from the inflated representations tied to the merger deal.
The SEC seeks to impose financial penalties on the charged companies and reclaim allegedly ill-gotten gains. Both the Department of Justice and FBI are also investigating the alleged Nigeria-linked fraud.
According to SEC, its case is filed in the U.S. District Court for the Southern District of New York, and the four defendants are being charged with violating the anti-fraud provisions of the federal securities laws.
The commission added that Mmobuosi was being charged with lying to auditors, insider trading, and failing to file Forms 4 disclosing the sales of millions of Agri-Fintech common stock for which he was the ultimate beneficial owner.
