JUST-IN: Tingo Group Inc., CEO Mmobuosi Odogwu Banye Found Liable for Fraud by Federal Judge Jesse Furman

Tingo Group Inc. and its CEO, Mmobuosi Odogwu Banye, have been found liable for fraud by federal judge Jesse Furman. The ruling comes after they failed to respond to a lawsuit from the US Securities and Exchange Commission (SEC) accusing them of inflating financial results.

Thank you for reading this post, don’t forget to subscribe!

The SEC’s lawsuit, filed in December, alleges that Tingo and its Nigerian subsidiaries engaged in fraudulent transactions and reported fictitious revenue and assets. Banye was accused of orchestrating the scheme.

On Wednesday, Judge Furman granted a default judgment in favor of the SEC, describing the fraud as “brazen.” The SEC is seeking over $1.15 million in penalties for each corporate defendant and nearly $32 million from Banye. This amount includes $25 million he allegedly misappropriated and triple the $2.1 million he earned from insider trading.

In June 2023, a report by short-seller Hindenburg Research highlighted fraudulent activity at Tingo, leading to a 48% drop in the company’s share price. The SEC claims that Nasdaq-listed Tingo continued to falsify results in public filings.

Banye, a Nigerian who was once considered a potential buyer of Sheffield United, was charged criminally in January by federal prosecutors in Manhattan for falsifying financial statements. He has not yet addressed the charges.

Tingo Group’s lawyers initially engaged in the case but failed to respond to subsequent court orders. The company was recently found in contempt of court in Delaware for not producing internal files.

The case is Securities and Exchange Commission v. Mmobuosi Odogwu Banye, 23-cv-10928, US District Court, Southern District of New York (Manhattan).