Parliament has received proposed amendments to the report by the public petitions committee on the probable loss of investments in the Cytonn High Yields Solutions Platform.
MP Samuel Atandi (Alego Usonga, ODM) now wants the report amended to recommend that the Directorate of Criminal Investigations (DCI) undertake investigations into Cytonn, the real estate investment firm and private equity company based in Kenya and the United States that was behind the CHYS and a related fund, Cytonn Real Estate Project Notes (CPN).
The MP wondered why the company is still allowed to operate despite more than 400 witnesses, including investors, questioning its business model before the parliamentary committee.
“This company has operated for a long period of time in this country, what they do is that they invite you to invest some money with them promising high returns. Once you put your money in the company, the money is transferred to several other companies called special purpose vehicles. By the time you go to Cytonn for your money, you are told the money was transferred to different companies in which Cytonn do not have directors,” the MP said.
Atandi wants the business dealings of 49 special purpose vehicles, and the relationship between Cytonn Investment executives and the Capital Markets Authority (CMA) between 2015 to 2021, investigated.
Other proposed amendments to the report include an investigation into the business dealings of Cytonn co-founder and CEO Edwin Dande, including his net worth.
The legislature wants the DCI to conduct the investigations within 90 days of the report’s adoption by the House.
In March, the Capital Markets Authority (CMA) told the parliamentary committee that the fund’s investors did not qualify for compensation from the Investor Compensation Fund. This was three months after a Nairobi court ordered the sale of assets owned by the two funds.
In contributing to the amendments, MP Gabriel Gathuka (Gatundu South, UDA ) said the report should not be taken in isolation but should also be used in areas such land buying where unsuspecting investors have lost money to dishonest dealers.
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