27 / 80
OUR MATERIAL MATTERS
| GOVERNANCE, RISK & REGULATION |
NETWORK QUALITY | ENVIRONMENTAL RESPONSIBILITY | INNOVATION |
27
Safaricom mass market caravan campaigns and other activations, especially in
rural areas, included awareness campaigns to alert customers to the common
fraud schemes used by crime syndicates and to offer advice on steps they can
take to prevent being defrauded.
We also increased the number of staff working in the team monitoring suspicious
activity on the M-PESA platform and implementing Anti-Money Laundering (AML)
and Counter-Terrorist Financing (CTF) measures, which has enabled us to achieve
our target of investigating and reporting suspicious M-PESA transactions within
seven days. We also host a Mobile Money Investigations Unit (MMIU), which is a
unit composed of officers from the Police Force. The unit investigates cases of
mobile money fraud and forwards such cases for prosecution.
REGULATORY COMPLIANCE
We ensure that we remain compliant with regulatory requirements by assessing
our processes against all applicable laws and regulations. We also engage with
our regulators proactively on all issues through a variety of channels
(please see
the stakeholders section on page 48 of this report for further information about this
important relationship).
Non-compliance register
FY17
FY16
FY15
Number of fines for non-compliance
1*
1*
1
Cost of fines for non-compliance (KES)
270,056,720 157,000,000 500,000
Non-monetary sanctions for non-compliance
0
0
1
Legal actions lodged for anti-competitive behaviour
0
2
†
0
* Communications Authority (CA) Quality of Service (QoS) fine
† Escalated actions lodged before the Competition Authority (outcome pending)
We were fined by the Communications Authority (CA) again this year. The CA
tested our network against its eight Quality of Service (QoS) measures and
indicated that we attained a score of 62.5% against a compliance minimum
score of 80%. Consequently, the Authority imposed a penalty of KES 270,056,720
on Safaricom. This penalty represents 0.15% of our Gross Annual Revenue (GAR)
for the period ending March 2017. It should be noted that we, along with the
other Kenyan mobile network operators, have expressed concerns regarding
the QoS measures used by the CA and that the Authority is evaluating the
methodology that underpins its testing framework. We continue to engage the
CA on the matter with the expectation that our framework concerns will be
addressed.
Anti-bribery bill enacted
It was rewarding to be part of the coalition that helped draft Kenya’s new anti-
bribery legislation and we are delighted to report that the Bribery Act has been
signed into law and came into force in January 2017. An important step towards
addressing the issues of corrupt practices in Kenya, the Act provides a more
robust system for preventing bribery, including obligations on individuals holding
positions of authority in Kenyan companies or companies operating in Kenya to
report instances of bribery and obligations on companies to put in place bribery
prevention policies and measures.
Network Redundancy, Resilience and Diversity (NRRD) guidelines
The CA is in the process of improving the NRRD guidelines and regulations for ICT
networks in Kenya (i.e. a toughening up of QoS regulations) and published a draft
document for stakeholder comment. We have since made a formal submission in
response to this draft and now await the regulator’s response.
Counterfeit handset monitoring
The CA has expressed its intention to install a monitoring system within Kenyan
mobile networks to help eradicate the use of counterfeit handsets. We, along with
SDG 16
SDG 16
SDG 16