Corporate Scandals MTN's operations raise suspicion as more fines surface

 Talks between the mobile network and the NCC are ongoing regarding the mega fine, which has been described as the world’s largest by Denmark-based Strand Consult.

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Apart from facing a $5.2bn fine in Nigeria, mobile network MTN has this year already paid millions of rands in other penalties, according to regulators.

MTN announced in October that it’s been fined $5.2bn by the Nigerian Communications Commission (NCC) for failing to disconnect up to five million unregistered SIM cards in that country.

 Talks between the mobile network and the NCC are ongoing regarding the mega fine, which has been described as the world’s largest by Denmark-based Strand Consult.

 MTN is Nigeria’s biggest mobile network with over 60 million subscribers. But MTN has been hit with other multi-million naira fines between July and September this year, according to the NCC’s compliance monitoring and enforcement activities report for the third quarter in 2015.

 The report outlines how the NCC “sanctioned  four mobile network operators, namely MTN, Airtel, Globacom and EMTS (Etisalat) a total sum of 40m naira (R2.8m) for sales of pre-registered SIM cards”. For this infringement, MTN was fined N21.8m (R1.5m), Airtel N3.8m (R270 000), Globacom N7.4m (R530 000) and Etisalat N7m (R500 000). The regulator, in its document, added that the “operators have since paid the above amounts”.

 Meanwhile, the NCC further fined MTN Nigeria N80.4m (R5.7m) in the quarter “for failure to deactivate a total of 420 MSISDN that were incomplete and improperly registered”. MSISDNs are telephone numbers linked to SIM cards and the penalty for this breach echoes that of the $5.2bn fine MTN received for failing to disconnect five million unregistered SIMs.

The NCC said that MTN Nigeria Communications Limited has paid this N80.4m fine as well. Fin24 contacted MTN for comment on these fines, but the company has not yet responded to questions.

Upcoming sanctions The NCC in its quarterly compliance monitoring and enforcement activities report has also issued a “notice of intention to sanction” service providers in that country over other infringements such as data bundle depletions and mobile number portability violations.

The regulator, in the report, explained that MTN was found to comply with notifying subscribers via SMS about their data bundles being depleted before the due date. However, MTN “failed to highlight the tariff rate for PAYG (pay-as-you-go) billing”, said the NCC.

 “In addition, data service is not suspended on depletion of the data bundle account even without an authorisation via an SMS from the subscriber,” said the NCC regarding MTN. In terms of mobile number portability, MTN is set to be slapped with “timer” fines regarding porting numbers. The NCC said it requires “validation and deactivation responses” regarding porting to each respectively have timelines of two hours and one hour.

 The NCC then said that MTN incurred a “timer deactivation violation” regarding a corporate port request of over 109 lines belonging to Nigerian Breweries Plc. “The company had initiated a corporate port out request from MTN to Glo via lead MSISDN: 07036735494 on August 11 2015 at 13:20 but was partially completed as at 11:22 on August 14 2015,” said the NCC.

 “As a result, these subscribers were not… able to receive calls from MTN subscribers,” explained the NCC. Another four numbers were also not ported according to the necessary timelines by MTN, said the NCC. Other African fines MTN is not only experiencing problems in Nigeria when it comes to fines.

Last week, Fin24 reported that MTN has been slapped with a Ugandan court order to pay $662 000 (R9.3m) in damages for anti-competitive behaviour. This fine came amid a dispute between MTN and Uganda money transfer service EzeeMoney over a telephone lines and internet contract.

MTN was accused of being anticompetitive by allegedly cancelling the contract as MTN has its own mobile money service in that country.

 Fin24 understands, though, that MTN has argued that it migrated EzeeMoney’s contract from prepaid to postpaid because of a lack of call volumes. MTN plans to appeal the court decision, a spokesperson told Fin24 last week.

Source: Fin 24

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