Nairobi, Kenya — Equity Bank, one of Kenya’s largest financial institutions, has dismissed several employees following an internal probe into suspicious account activities and irregular M-Pesa transactions.
The terminations, confirmed on Tuesday, come after an audit unearthed what the bank termed “serious breaches of internal policy and suspected fraud.” At the heart of the issue are numerous unauthorised customer accounts and unapproved M-Pesa mobile money dealings linked to insider collusion.
While the bank did not disclose the exact number of staff dismissed, sources close to the matter say the figure is “significant,” involving both junior and mid-level employees across several branches.
Investigations Underway
According to internal documents reviewed by this publication, some employees were allegedly creating and operating “ghost accounts” — accounts not linked to any real customer. These accounts were then used to channel suspicious mobile money transactions, mainly via M-Pesa.
“The irregularities became apparent during a routine system audit,” said one senior source at the bank who asked not to be named due to the sensitivity of the issue.
Equity Bank said it is working closely with the Banking Fraud Investigations Department (BFID) and Safaricom, which runs M-Pesa, to trace the transactions and ensure all responsible parties are held to account.
In a statement issued Tuesday morning, Equity said:
“We take matters of financial integrity and customer trust extremely seriously. We have taken decisive disciplinary action against individuals found in breach of our operational standards and ethical conduct.”
System Exploited
Preliminary findings suggest that the suspected fraud ring may have taken advantage of lax internal controls around account creation and mobile money integration. Some staff reportedly bypassed verification procedures to open accounts and process illegal transfers.
The revelations have sent shockwaves through the financial industry, where M-Pesa remains a dominant money transfer platform. Equity Bank is one of its largest integrators, offering customers access to funds directly through bank-linked M-Pesa services.
“Financial institutions must tighten digital fraud checks,” said Sarah Mutua, a financial analyst based in Nairobi. “This is a wake-up call to banks that mobile money services are vulnerable if not properly monitored.”
Customers Reassured
Equity has moved to reassure customers, stating that no client accounts were compromised and that all funds are secure.
“Customer security remains our top priority,” the statement continued. “We are enhancing surveillance systems and conducting a wider internal review to prevent similar incidents.”
Safaricom also confirmed its cooperation in the investigations. “We have zero tolerance for misuse of our platform,” said a company spokesperson. “We are fully supporting the investigation to ensure full accountability.”
A Broader Industry Concern
This is not the first time a Kenyan bank has faced fraud linked to mobile money. With mobile transactions accounting for billions daily, financial experts have long warned of the need for tougher regulation and compliance monitoring.
Equity Bank’s swift action, while praised by some, also raises questions about how long the fraud went undetected and whether oversight was sufficient.
The Central Bank of Kenya (CBK) has yet to issue a formal comment but is expected to weigh in as investigations unfold.
As the case continues, attention now shifts to how Equity — and the broader banking sector — can rebuild trust and improve internal controls in a mobile-first economy.
