SIM infraction: Fed Govt slashes MTN’s fine to N674b

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Communication giant MTN Nigeria got some reprieve from President Muhammadu Buhari yesterday. The President slashed the N1.04 trillion fine imposed on it by Nigeria Communications Commission (NCC) over infractions on subscriber identity module (SIM) card.

The South African firm will now pay N674 billion on or before December 31. The telco got the NCC knock for keeping some 5.2 million pre-registered SIM cards running on its network, contrary to a directive from the regulator that all operators should deactivate such SIMs on their networks.

Heightening security concerns forced the regulator to issue the directive.

The relief came on a day MTN’s Chief Executive Officer (CEO) in Nigeria, Michael Ikpoki and its Head of Regulatory & Corporate Affairs, Akinwale Goodluck, resigned their appointments with the embattled carrier.

The $5.2 billion fine had earlier consumed the company’s Group Chief Executive, Sifiso Dabengwa, who resigned shortly after the NCC hammer hit the telco. Pressure was subsequently mounted on Ikpoki to resign his appointment, failing which he would be risking being kicked out. He was replaced by Ferdi Moolman as MTN Nigeria CEO, while Amina Oyagbola has taken over from Goodluck as Head of Regulatory & Corporate Affairs.

The telco, however, appointed a Nigerian, Karl Toriola, Vice President, West and Central Africa (WECA) Region. Based in Nigeria, Toriola has worked with MTN for 10 years, having held senior operational roles at MTN Group and MTN Iran. He was formerly the Chief Technology Officer at MTN Nigeria and CEO at MTN Cameroon.

It was learnt yesterday that MTN has received a formal letter on Wednesday from MTN Group Corporate Affairs said yesterday, informing the company that, after considering the company’s request, it has taken the decision to reduce the fine on the MTN Nigerian business from the original N1, 04 trillion to N674 billion, which has to be paid by 31 December 31. The fine has to do with the late disconnection of 5.1 million MTN Nigerian subscribers in August and September 2015.

The letter reads: “The company is carefully considering the NCC’s reply, however the Executive Chairman Phuthuma Nhleko will immediately and urgently re-engage with the Nigerian authorities before responding formally, as it is essential for the company to follow due process to ensure the best outcome for the company, its stakeholders and the Nigerian authorities and accordingly, all factors having a bearing on the situation will be thoroughly and carefully considered before the company arrives at a final decision.”

The statement advised the company’s shareholders to continue to exercise caution on issues relating to national securities until a further announcement is made.

The telco said it has also reviewed its operating structure with a view to strengthening operational oversight, leadership, governance and regulatory compliance across its 22 country operations in Middle East and Africa (MEA).

It said it has therefore resolved to re-implement its previous reporting structure which would see MTN Group restructured into three regions – namely WECA, South and East Africa (SEA), and Middle East and North Africa (MENA).

Under the restructuring, Jyoti Desai assumes the new position of Group Chief Operating Officer (COO). Based in Johannesburg, she will report to the Executive Chairman, Phuthuma Nhleko. Ms. Desai has 14 years’ experience at MTN.

She has previously held the positions of Chief Information Officer at MTN Nigeria and Chief Operating Officer (COO) of MTN Irancell. She was recently seconded to support the company operations in Nigeria. Her replacement as Group Chief Technology and Information Officer will be announced soon, while the appointment takes effect from December One, this year.

Also appointed was the Vice President for MENA, Ismail Jaroudi, while the Vice President for SEA will be announced soon, the statement said.

Jaroudi has been CEO of MTN Syria since 2006. Prior to this, he held senior operational roles for Investcom’s subsidiaries across the Middle East and North Africa.

Also reporting to the Executive Chairman, is the new Group Executive for M&A, Matthew Odgers. The former Head of TMT for Africa and the Middle East and Head of Investment Banking for MENA at UBS, Odgers led UBS’ overall relationship with MTN.

Mr Moolman was previously COO at MTN Irancell and recently CFO at MTN Nigeria. Nigerian Ms. Oyagbola retains the position of MTN Nigeria’s Head of Human Resources. She formerly headed regulatory affairs at the Nigerian operating company.

The search for the MTN Group CEO is underway and remains a priority, the telco said.

Commenting on the announcements, Nhleko said: “This revised structure and strengthened leadership will improve operational oversight and increase management capacity. This will enable MTN to continue to realise its strategy and vision, while also ensuring we achieve high governance standards and robust risk mitigation.

Source: The Nation