The Capital Markets Authority (CMA) has cautioned investors against investing through unlicensed and unapproved entities.
The CMA Chief Executive, Wyckliffe Shamiah, advised investors to only invest through licensed and approved entities who offer and promote regulated products, to enable them to get the protection offered by the Authority through the capital markets legal and regulatory framework.
The caution by the regulator comes at the time investors are complaining that they have not been able to withdraw their funds from a high yield fund, years after putting their money in it.
Investors who invest in unregulated products offered or promoted by unlicensed and unapproved entities risk the 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.”
Those affected have been advised to report to the Capital Markets Fraud Investigation Unit (CMFIU), which is the police unit attached to CMA.
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 the regulator 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.