CMA recovers Sh 458M in connection with suspicious trades in KenolKobil shares

The Capital Markets Authority (CMA) says it has secured the surrender of potentially illegal gains amounting to Ksh458 million in the context of the ongoing investigations into insider trading on KenolKobil shares. The funds surrendered to date relate to 90 percent of the quantum of suspicious trades identified through a total of 14 accounts that were frozen in October 2018 to facilitate investigations. The recovered funds will be paid into the Investor Compensation Fund.

The investigations thus far have established that a number of investors had been advised and encouraged to trade based on what may constitute material price sensitive non-public information resulting in trades in Kenol Kobil shares before the October 24 2018 announcement by Rubis Energie of their intention to take over 100 percent ordinary share capital of KenolKobil Plc at a premium. The investigations relating to the balance of the accounts flagged in connection with suspicious trading activities are ongoing.

Upon review of the investigation findings and recommendations, the CMA board said it had resolved to initiate enforcement proceedings against the Kestrel Capital Executive Director, Mr. Andre DeSimone, Kestrel Capital Chairman & Founder, Mr. Charles Field-Marsham, and their stockbroking agent, Mr. Aly Khan Satchu, through issuing Notices to Show Cause.

“The recipients of the Notices to Show Cause have been granted an opportunity to formally respond to allegations made against them and to appear before the CMA Board to make any submissions before a determination is made.” it said in a statement.

According to CMA, investigation findings did not establish evidence of potential misconduct with regard to the KenolKobil Chief Executive, Mr David Ohana and therefore no enforcement proceedings will be initiated against him.

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Kenol Kobil shares to remain suspended at the NSE

If CMA Wins the Insider Trading Case Touching on Kenol Kobil, It will be a Major Milestone for the Financial Markets Regulator