[ad_1]
Cytonn Investments CEO Edwin Dande now wants Capital Markets Authority (CMA) to desist from fighting the companies it regulates in public, following a series of attacks on the investment company.
In a Facebook post, Dande said that CMA through its CEO Wycliffe Shamiah has been issuing misleading statements meant to mudsling Cytonn.
“I am sure CBK (Central Bank of Kenya) has a lot of issues with some banks; I am sure RBA (Retirement Benefits Authority), which also regulates Cytonn Pensions, has a lot of issues with some pensions funds. I am sure IRA (Insurance Regulatory Authority, which also regulates Cytonn Insurance Brokers, has a lot of issues with some insurance companies, but they don’t take to the press to engage licensees,” wrote Dande on Wednesday, June 23.
This comes at a time Cytonn has been receiving attacks from social media over its private money market solutions, Cytonn High Yield Solution (CHYS) and Cytonn Private Notes (CPN).
Read: Cytonn Accuses CMA Of Malice Over Statement On CHYS
CMA has been accusing Cytonn of running the two products which are unregulated, demanding that the two are placed under CMA’s watch.
“Cytonn did not pull out of the DREIT (Development Real Estate Investment Trust) conversion, the regulator capriciously ended that process as we were looking for a REIT Trustee. Cytonn is ready, able and willing to convert CHYS into a DREIT. CHYS is properly a private offer, we have even submitted the issue for judicial interpretation, but for the sake of peace in the market and most importantly to protect investor interest, we are happy to convert it,” said Dande.
According to Dande, the largest operator of private offers is Britam Asset Managers which runs Wealth Management Fund LLP (formerly Britam Cash Management Solution) as a private offer. He says that the solution even lends to entities controlled by a few of its big shareholders, which led to a loss of Ksh5 billion in the financial year ended December 31, 2020.
“This loss was transferred to all Britam shareholders, and translates to a loss of about 2 bob for each of Britam’s 2.5 billion shares, who should have been protected by the regulator,” said Dande.
Read: CHYF Video Making Rounds Is Factually Incorrect and Misleading – Cytonn
Other players engaged in private offers included Nabo Capital, MyCredit, Car & General, KK Security, ASL Credit, Watu Credit and Kaluworks.
“I am identifying these programs, not that I have any issues with them, but to demonstrate that CMA is a discriminatory agency. If CMA is calling the police on private offer operators, call on everyone, and haul all of us to court,” he added.
Dande says that several products regulated by CMA have recorded more losses and defaulted on paying out investors as compared to privately offered products.
“Imperial Bank Bond, Chase Bank Bond, Amana Money Market Fund, Uchumi, Mumias, and CMC were all regulated offers, yet this protected class of investors walked away with zeros. Lets not falsely elevate regulated offers above private offers without statistical evidence, they are both essential to the market. Private offers finance projects, employ people, and grow the economy. They fund situations that banks or regulated capital may not venture into. The largest comprehensive lifestyle development in this country, The Alma, has been financed by private offers,” he said.
Appearing on NTV on Tuesday, June 22, 2021, Shamiah said that discussions with Cytonn to convert CHYS into a DREIT collapsed, since Cytonn felt that the “product was as good as it is”.
“That is why you can see them complain of hostility from us because we have been very firm to say “we cannot allow you to do something which may look like a licensed business without approval from the authority”,” said Shamiah.
Read: Co-op Bank, Sanlam and Cytonn Named Top 3 Unit Trust Funds By CMA
In a statement last week, CMA stated that Cytonn Investments is not a licensed and approved entity, urging investors who are affected by investing in unregulated products to 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). The Authority on 20 April 2020 communicated this same information to the public,’’ said Shamiah.
CMA however acknowledged that it 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.
Email your news TIPS to news@kahawatungu.com or WhatsApp +254708677607. You can also find us on Telegram through www.t.me/kahawatungu
Related
[ad_2]
