CMA warns public against Cytonn High Yield Solutions

The Capital Markets Authority has warned the public against investing in Cytonn High Yield Solutions, following public uproar over their failure to fulfill their commitments.

A video that has been circulating on social media by Lynn Ngugi and where she raised her frustrations on Cytonn Investment, forced CMA to issue the statement. She claimed Cytonn were fraudulent to throw their clients off by extending the time for paying back their hard invested money.

Lynn Ngugi, who posted on her Instagram account, came out offensive on the Cytonn Investments High Yield Solutions (CHYS) on the claim that the body had withheld their money when it was time to pay their annual dividends.

“Towards January 2020, we wrote to them and told them, we need our money back because our money was maturing in March. This was before COVID hit. So, we get to March, COVID has hit the country, and Cytonn uses COVID as an excuse of not releasing our money to us,” Miss Ngugi expounded in her Instagram reel video.

The video caused an uproar with many people clothing it as a scam, and others coming out to defend it, claiming it has faced tough times as other industries, and only requires time to respawn.

The High Yield Solutions (Cytonn HYS), was premised on delivering 18 percent per annum return to investors, making it very popular.

The capital markets regulator explained that Cytonn’s High Yield Solutions is not regulated by them, hence the public should be cautious when dealing with them.

Mr. Wycliffe Shamiah, CMA CEO advised investors to only invest through licensed and approved entities to enable them to get the protection offered by the Authority through the capital market’s legal framework.

According to the licensing agency, it has licensed Cytonn Asset Management Limited, a licensed Fund Manager managing the following identifiable 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, all of have not had any complaints lodged against them.

Cytonn Investments, which is a familiar name in the investment industry, went out to make a statement through an interview with the Group CEO, Mr. Edwin Dande, who claimed that the money was still safe.

“If you are investing in real estate, illiquidity is one of the risks. There could be a time when the money could not come out of the real estate,” he explained.

Mr. Dande however admitted that Cytonn did face challenges which he fractionated into; the Pandemic, a hostile regulatory environment and finally activities from investors as the third issue.

Even with Cytonn still claiming the investment vehicle is still viable, Mr. Shamiah offered that the investors affected in infusing into these unregulated products should report to the Capital Markets Fraud Investigation Unit (CMFIU), 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),” he included.


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