The Tingo Group Scam

The Tingo Group Scam
Case Code: BECG188
Case Length: 17 Pages
Period: 2019-2024
Pub Date: 2024
Teaching Note: Available
Price: Rs.400
Organization: Tingo Group
Industry: Financial Services
Countries: Nigeria
Themes: Business Ethics, Entrepreneurship
The Tingo Group Scam
Abstract Case Intro 1 Case Intro 2 Excerpts

Abstract

Tingo, an agri-fintech firm established by Odogwu Banue Mmobuosi (Mmobuosi) in 2001 in Nigeria, supposedly pioneered financial inclusion among farmers with its innovative device-as-a-service model. By providing mobile phones to farmers through its mobile company, Tingo Mobile, the company provided the farmers access to crucial resources. The company was listed the US OTC market in August 2021 and on the NASDAQ in 2022. However, investigation by short-seller Hindenburg showed that Tingo was a web of lies perpetrated by Mmobuosi and neither the company, not its mobile phones, customers or farmers actually existed. The Securities Exchange Commission filed lawsuits against Mmobuosi and his companies, citing false financial reporting and a securities fraud. On January 02, 2024, the FBI indicted Mmobuosi on securities fraud charges, accusing him of conspiracy and false filings with the SEC. Subsequently, in February 2024, Tingo voluntarily delisted from the NASDAQ.

The fallout of Tingo's scandal reverberated beyond the company itself, casting a shadow on the Nigerian business landscape and raising concerns about fintech companies from emerging markets. Tingo's meteoric rise and subsequent fall epitomized the perils of unchecked ambition and fraudulent practices in the corporate world, serving as a cautionary tale for investors and regulators alike.

Issues

The case is structured to achieve the following teaching objectives:

  • Examine the reasons for the unethical behavior of founders and analyze how stakeholders miss obvious red flags due to an unequal focus on growth and share price
  • Determine the motives, opportunities, and rationalizations behind a fraud through the Fraud Triangle.
  • Understand different types of securities fraud
  • Analyze how frauds can go undetected

Contents

Keywords

Tingo; Fintech; Fraud, Fraud Triangle; Agriculture; Nigeria; inclusion, device-as-a-service; financial inclusion; unethical practices; unethical founders; red flags; motives of fraud; opportunities of fraud; rationalization behind fraud; the fraud triangle

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