The High Court has issued a stern order prohibiting the Capital Markets Authority and the CEO Wycliffe Shamiah, from making more defamatory statements against Cytonn.
In the ruling presided by Justice J Chepkwony, the court threw away the CMAs application that was seeking to brush off the suit filed by Cytonn.
Shamiah had claimed that Cytonn is unregulated and unlicensed. He further accused Cytonn CEO, Edwin Dande of facing professional disciplinary cases.
These utterances put CMA under task to prove what they were saying is true. The court later found out that Cytonn is a duly registered and licensed company and thus had satisfied the requirements of a temporary injunction.
According to the court, it was, therefore, necessary for CMA to delete any defamatory posts published, retract the statements and issue an apology before ruling in the main suit.
In the main suit, the CEO of Cytonn Dande accused Shamia of loitering the halls of parliament, TV stations, and all-over social media telling half-truths and fabrications about two Cytonn products, i.e. the Cytonn High Yield Solution (CHYS) and Cytonn Private Notes (CPN).
The two funds, according to managers at Cytonn experienced liquidity strains at the onset of the Covid-19 pandemic. But the situation was further accelerated by negative publicity and sustained social media regulatory attacks by the management of the Capital Markets Authority (CMA).
According to Mr. Dande, this act hurts the investors who are supposed to be protected, and thus had to stop.
The funds were placed under administration in October 2021, as part of ongoing efforts to turn around their performance. The Chief Executive Officer of Cytonn Group, Edwin Dande filed an application for the administration, under a unanimous resolution by the Board of CHYS investors.
The administration gives the funds the room to restructure, recover, and return value to investors. Meanwhile, during an investors’ meeting held on April 13, 2022, the investors said they now want the court-appointed administrator Mr. Kereto Marima removed.
They also voted to have the process of tracing financial flows started and enforcement of the corporate guarantee.