A significant penalty has been levied against a prominent digital payments company in Liberia due to lapses in anti-money laundering and counter-terrorism financing protocols. Recently, the Financial Intelligence Agency (FIA) of Liberia announced a substantial fine of LRD 25 million (equivalent to USD 125,000) against Lonestar Cell MTN Mobile Money Inc (LCMMMI). This decision stems from the organization's inability to adhere to national AML/CFT regulations. The penalty was declared on April 28, following an inspection conducted in September 2024.

Corporate governance issues have surfaced as a primary concern for LCMMMI, which is a leading mobile money service provider in Liberia. Established in 2011, the company operates under the umbrella of telecommunications giant Lonestar Cell MTN, itself owned by South Africa’s MTN Group. Findings from the FIA investigation revealed that LCMMMI had not established an independent board separate from its parent company, leading to deficiencies in its compliance system. This issue was initially flagged in a report by the Central Bank of Liberia (CBL) back in December 2018 but remained unaddressed until now. The FIA expressed strong disapproval, emphasizing the risks associated with such negligence over an extended period.

Further scrutiny uncovered additional vulnerabilities within LCMMMI's operations. Notably, the company failed to conduct necessary assessments of all its agents, enabling an e-commerce scam known as Smart AI to exploit its system. This led to a widespread Ponzi scheme in 2023, defrauding numerous Liberians. Moreover, LCMMMI did not secure explicit authorization from the CBL to enable unlimited transaction levels for full agent and merchant transactions. In response, the FIA has mandated that LCMMMI devise and submit an action plan by May 12 to rectify these shortcomings. These measures aim to ensure comprehensive adherence to AML/CFT obligations.

Strengthening financial integrity and combating illicit activities are crucial steps towards fostering economic stability and public trust. The recent actions taken by Liberian authorities underscore their commitment to upholding robust regulatory frameworks. By addressing these compliance gaps, organizations like LCMMMI can contribute positively to a safer financial ecosystem, promoting transparency and accountability while protecting consumers from fraudulent schemes.