The Court of Appeal has dismissed all appeals linked to the failed Cytonn High Yields Solutions (CHYS) and Cytonn Project Notes (CPN) schemes, confirming that more than KSh 11 billion collected from over 3,000 investors was sunk into unregulated vehicles now under liquidation.
- •The rulings, contained in Court of Appeal files E116, NAI E923, E091–E094, E927–E934, E032 of 2025, and E102–E105, upheld the High Court’s finding that investor funds were channelled into Cytonn-controlled SPVs without security, proper governance or regulatory oversight.
- •The judges held that the SPVs were not independent entities, but structures operated and funded by Cytonn Investment Management PLC and its promoters.
- •The Court of Appeal reiterated that the High Court’s remark describing Cytonn’s structure as “akin to fraud” did not amount to a legal finding of fraud: Instead, the phrase reflected the pattern of unsecured inter-company lending, commingling of investor funds and undisclosed conflicts of interest documented in the court record.
A Parliamentary Finance Committee report (2023) later confirmed that Cytonn operated CHYS, CPN, 49 SPVs and 20 related entities without capital-markets supervision, exposing thousands of retail investors to unprotected losses.
While the courts confirmed over KSh 11 billion in traced investor exposure, wider estimates place the total at KSh 13–14 billion, according to reporting by The Star, which reviewed disclosures tied to RiverRun and related SPVs.
The courts affirmed preservation and vesting orders placing major Cytonn projects under the Official Receiver after forensic tracing linked them to CHYS and CPN funds. These include:
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RiverRun (Ruiru) — financed through more than KSh 831 million from CHYS. A valuation by Regent Valuers International, filed in the court record, placed its fair market value at KSh 2.113 billion, with a forced-sale value of KSh 1.585 billion.
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Kilimani Apartments (CIP16) — Cytonn’s re-entry was ruled unlawful; possession returned to the liquidator.
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The Alma (Ruaka) — CHYS exposure: KSh 1.437 billion.
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CySuites / Wasini (Westlands) — KSh 187 million traced.
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Taraji Heights, The Ridge, Athi River land, Mystic Plains/Newtown, Applewood/Miotoni, and a 12.5 per cent stake in Superior Homes Kenya — all preserved and vested for liquidation.
The exposures are drawn from the Administrator’s Report filed in Insolvency Petition E063 of 2021 and reproduced in the appeal bundles. In total, CHYS lent KSh 5.8 billion to its project SPVs without registering charges or securing investor funds.
The judgment outcomes align with earlier warnings by the Capital Markets Authority, which on 17 June 2021 publicly declared that CHYS and CPN were unregulated and under criminal investigation by the Capital Markets Fraud Investigation Unit. Cytonn acknowledged in its own press response that CHYS was a private product outside CMA’s oversight.
The liquidator is expected to proceed with valuations, preservation and sale of the properties to recover money for investors, with secured creditors such as SBM Bank retaining priority over charged assets.
