Nairobi — Tools for Humanity, the parent firm for the Worldcoin Operation Project, was hard-pressed on Wednesday to explain why they failed to register as a business entity before embarking on data mining activities in Kenya.
Appearing before the National Assembly Adhoc Committee investigating the firm's operations, Tools for Humanity Chief Legal Officer Scott Thomas told MPs that since April 2022 they were operating under the legal requirement as data controllers.
Thomas explained that Cabinet Secretary for ICT Eliud Owalo had moved to allay any concerns that Tools for Humanity was operating outside the confines of the law.
"We subsequently engaged with the office of data commissioner and secured registration certificate as data controllers, as late as 2nd august this year CS Eliud Owalo said that we were operating within the law," he said.
Worldcoin Project activities raised concerns over processing of iris data captured via an orb scanner issuing users Worldcoin tokens valued at Sh7,000 in July.
"We recognize that there might be certain concerns as to our operations but we feel that we have genuinely and consistently done our level best to comply with the law," Thomas told MPs.
The Tools for Humanity Chief Legal Officer said the Office of Data Protection Commissioner under Immaculate Kassait as well as their legal counsels in the country had adequately advised them that they did not need to register as a business entity.
"We have looked this question and meaningfully assessed our activities here, and its our considered view with the advice of Kenyan lawyers that we don't have to register with the business registration office," Thomas said.
"We are not doing business in Kenya,we are just like Uber and Google," he added.
Unregistered business
Committee Chairperson Gabriel Tongoyo challenged the argument saying the firm's data mining activities involved monetary transactions hence linked to business operations.
"You say you were registered as a data controller but as a foreign country you needed to register with the business registration office to allow you to continue with your business," Tongoyo said.
Mbeere North MP Geofrey Ruku poured cold water on the explanation by Tools for Humanity that they were not legally required to seek business permits from the business registration service as data transmitters.
"There is no way that Tools for Humanity can carry out business activities through other agents without registration. It's within the Companies Act, your lawyers gave you wrong advise and you should sack them," Ruku said.
Gatanga MP Edward Muriu termed Worldcoin activities suspicious as information concerning their registration and approvals was still unclear.
"Currently its looks like it's a gag of criminals who wants to harvest data from our young people in exchange for money. We want to find out where does the forte lies, does it lie with the data commissioner or the lacuna of our law," he observed.
Uncertified scanners
Tools for Humanity were also put on the spot for importing Orb operators which were used to mine data through scanning individuals' irises.
The Office of the Director of Criminal Investigation and Communication Authority Director General Ezra Chiloba revealed that the Orb devices used to scan irises had not received certification.
"Looking into the regulations we observed that there was no need of approval at the time for the devices that were operating in the country," Thomas said.
"The device was identified by the DCI as a biometric scanner from the point of entry where it was supposed to seek type approval before entry in the country. It was supposed to be classified as a communication gadget," Tongoyo responded.
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"The orb device in the classification of DCI is a telecommunication device and as such a device that should have sought for a type test and approval. The question begs where type approval happen after operationalization," Dagoretti South MP John Kiarie added.
Alex Blania, the Tools for Humanity founder explained that on July 24, when the Worldcoin protocol became available on global exchanges, the firm faced unprecedented demand it had not anticipated.
"While we had spent more than three years preparing for this day technologically, we were not prepared for the demand for World ID to increase thirty times practically overnight. We could have done a better job in managing this increase in demand and the long lines that came with it," Blania stated.
Concerns over the transparency of Worldcoin operations have been raised in France, India, Germany, UK and other countries.
