Nigerian CEO fined $250million by US Court in fraud case

A US federal court has ordered Nigerian businessman Dozy Mmobuosi, who last year attempted to purchase the English football club Sheffield United, to pay over $250 million in fines and has barred him from serving as a director of any public company. 

The ruling by Judge Jesse M Furman of the US District Court for the Southern District of New York comes after the US Securities and Exchange Commission (SEC) charged Mmobuosi and three of his companies with fraud. The charges stemmed from allegations that Mmobuosi inflated the financial performance metrics of his companies, including two Nasdaq-listed firms, to deceive investors globally.

The court's decision, entered by default, follows Mmobuosi's failure to respond to the civil complaint filed by the SEC in December of last year. Judge Furman noted that Mmobuosi and his companies—Tingo Group, Agri-Fintech Holdings, and Tingo International Holdings—had "failed to answer, plead, or otherwise defend" themselves in the case.

The SEC had accused Mmobuosi of fabricating virtually all aspects of his business empire. Tingo, a fintech group, claimed to have over nine million customers in Nigeria, primarily farmers, and to operate a food processing business. However, the SEC's investigation revealed that the company's purported assets, revenues, expenses, customers, and suppliers were almost entirely fictional. 

One striking example of the alleged fraud was Tingo Mobile's reported cash reserves of $461.7 million in 2022, which the SEC found to be less than $50. The scale of the deception prompted the SEC to describe the fraud as "staggering."

The case gained additional attention last year when Hindenburg Research, a US-based short seller, released a report questioning the viability of Mmobuosi's businesses, labeling them as an "exceptionally obvious scam." The report led to a dramatic 60% drop in Tingo's stock price on the day of its publication.

The SEC had already taken action against Mmobuosi's companies in June 2023, halting trading in the shares of Tingo Group and Agri-Fintech Holdings due to concerns about the accuracy of the information available to the public.

Mmobuosi had gained prominence in the UK last year when he made an audacious bid to acquire Sheffield United, a football club based in Yorkshire. At the time, the club was competing in the English Premier League but has since been relegated to the second tier of English football.