CMA cautions investors against investing in unregulated products offered or promoted by unlicensed firms or unapproved entities
Nairobi, 17 June 2021…In line with its investor protection mandate, the Capital Markets Authority (CMA) has cautioned investors against investing through unlicensed and unapproved entities.
The CMA Chief Executive, Mr. Wyckliffe Shamiah, advised investors to only invest through licensed and approved entities who offer and promote regulated products, to enable them get protection offered by the Authority through the capital markets legal and regulatory framework. Investors who invest in unregulated products offered or promoted by unlicensed and unapproved entities risk loss of their investments with no recourse afforded to them under the capital markets regulatory framework.
Following numerous enquiries regarding the licensing status of the Cytonn Investment Group, Mr. Shamiah said, “the Authority confirms that Cytonn Investments is not a licensed and approved entity.” He further stated that, “investors who are affected by investing in unregulated products should report to the Capital Markets Fraud Investigation Unit
(CMFIU), which is the Police Unit attached to the Capital Markets Authority. CMFIU is currently investigating the issue for criminal violations for investors in the Cytonn High Yield Solutions (CHYS). He reiterated the Authority on 20 April 2020 communicated this same information to the public’’.
CMA has licensed Cytonn Asset Management Limited, which is licensed as a Fund Manager managing the following regulated funds: Cytonn Money Market Fund; Cytonn Balanced Fund; Cytonn Equity Fund; Cytonn Africa Financial Services Fund; Cytonn Money Market Fund (USD); and Cytonn High Yield Fund. So far CMA has not received any complaints on these regulated products.
Investors are advised to confirm the names of the licensed and approved entities offering services in the capital markets industry from the CMA website www.cma.or.ke. Members of the public who have been affected or have come to be aware of such illegal entities are advised to report to the Authority or to the Capital Markets Fraud Investigation Unit.
ENDS
BACKGROUND INFORMATION ON THE CAPITAL MARKETS AUTHORITY
The Capital Markets Authority (CMA) was set up in 1989 as a statutory agency under the Capital Markets Act Cap 485A. It is charged with the prime responsibility of both regulating and developing an orderly, fair and efficient capital markets in Kenya with the view to promoting market integrity and investor confidence. The regulatory functions of the Authority as provided by the Act and the regulations include; Licensing and supervising all the capital market intermediaries; Ensuring compliance with the legal and regulatory framework by all market participants; Regulating public offers of securities, such as equities and bonds & the issuance of other capital market products such as collective investment schemes; Promoting market development through research on new products and services; Reviewing the legal framework to respond to market dynamics; Promoting investor education and public awareness; and Protecting investors’ interest. For more information, please contact: Antony Mwangi, Manager, Corporate Affairs and International Relations, on amwangi@cma.or.ke
