Search here...
Capital Markets

Cytonn Cease and Decease Letter to CMA CEO, Wycliffe Shamiah

Your Ref: TBA

12th August, 2021

Mr. Wycliffe Shamiah,

The Capital Markets Authority,

Embankment Plaza, 3rd Floor,

Longonot Road, off Kilimanjaro Avenue, Upperhill.

P.O Box 74800 – 00200.

NAIROBI.                                                                    “Advance Copy via Email


Dear Sir,


The above-captioned matter refers.

Following your incessant attack on the Cytonn brand, you are putting into risk investments of over 30,000 Kenyans valued at over Kshs. 20 billion and we now seek to protect the interests of innocent Investors hence, we are considering proceedings against you in the following manner: –

  1. We are considering instituting defamation proceedings against you, Wycliffe Shamiah, in the High Court at Nairobi Civil and Tax Division and we have instructed the law firm of Prof. Tom Ojienda and Associates to act for us;
  2. We are also seeking your expeditious removal from office because it is our view that (a) you have fallen short of upholding the provisions of Article 10 of the Constitution on National Values and Principles of Governance, and specifically Article 10 (2) (c) on “good governance, integrity, transparency, and accountability”, (b) you have contravened Article 75 of the Constitution, and (c) that you present a clear and imminent danger to our capital markets.

Consequently, we have instructed the law firm of Apollo Mboya and Company to immediately institute proceedings to remove you from office on the following grounds:

  1. Your incessant lying to the Kenyan Public, the Parliamentary Committee on Finance and Planning, and the National Treasury Secretary about the legality of Private Offers, which are provided for in the regulations and confirmed by your letter dated April 14th, 2016;
  2. Your continued partisan application of policy and the regulations,
  3. Your continued commission of illegalities and irregularities at the Capital Markets Authority in favour of some players to the detriment of certain singled out players, as set out in this letter;
  4. We are also seeking your removal from office given your continued targeting of former Britam Employees who joined Cytonn to wit; – Edwin Dande, Elizabeth Nkukuu, and Patricia Wanjama, as captured in the minutes of the CMA Meeting held of March 13th, 2019 where they were condemned unheard in total violation of the non-derogable right to a fair hearing;
  5. Continuous and repeated violation of Fair Administrative procedures, wherein you recently gave Cytonn shareholders, including one on maternity leave, less than 24 hours to appear in person failing which, you then proceeded to sanction them when they requested for rescheduling;
  6. Your wilful failure to put into place appropriate policies to facilitate the financing of the President’s housing agenda;
  7. Your failure to provide regulations that would enable the registration of Corporate Trustees in order to provide a fair playing grounds for capital markets.
  8. Our Claim

It has been brought to our attention that you, without proof or reasonable presumption on which to base your statements, uttered, published or caused to be published under the Capital Markets Authority website various statements seeking to discredit the authenticity of the company and its operations; and which statements have caused concern from potential partners as well as our clients. You have done this through various forums:

  1. The statements that you, Mr. Shamiah released to the media which can be accessed on NTV’s YouTube channel vide link ,
  2. By way of the inaccurate and misleading statements made by you in your capacity as the Capital Market’s Authority CEO and published on the Capital Markets Authority’s website through two press releases dated 20th April 2020 and 17th June 2021. Where the press release sought to lend credence to false viral video by someone who is not even Cytonns’ client.
  • By way of the inaccurate and misleading statements made by you Mr. Shamiah the Capital Market’s Authority CEO in your Report to the Parliamentary Committee on Finance and Planning dated July 6th, 2021 and the attendant hearing.

We have reason to believe that the statements made by you Mr. Shamiah, in their plain and ordinary meaning and by necessary implication not only refer to Cytonn but also could be interpreted to mean that Cytonn is an opportunistic investment partner intent on unfairly taking advantage of its investors and the general public.

Instances of Defamation

  1. Press release on 17 June 2021: CMA cautions investors against investing in unregulated products offered or promoted by unlicensed firms or unapproved entities.

“The Authority confirms that Cytonn Investments is not a licensed and approved entity.” In promoting the confusion in the market, the authority did not distinguish between the regulated and/or unregulated products but rather made a blank statement implying that the larger Cytonn company or rather, Cytonn itself was acting without the law and in breach of the law. There is no requirement for Cytonn Investments’ private offers to be licensed by CMA and it is needless to say that this matter is before Court and we shall endeavour to get the Courts interpretation on the same.

  1. Verbal Press Release by Wycliffe Shamiah available on NTV’s YouTube Channel.

In the video, you,  Mr. Shamiah is heard and seen stating the following “Given that Cytonn Investments Management was not our licensee in law what happens next is we go to police and report this is a criminal offence. Someone doing something that is more or less raising money from the public without an approval. We did communicate that to Cytonn very clearly. Around 2018 -2019 we did insist that they had to stop, because if it is like they were actually accessing money from the public this is not allowed. And the choice we gave them because we were looking at it as in if they are already clients how can they have an option”

By your statements you are seen, heard and understood to insist that Cytonn Investments is operating without the sanctioning of the law and approval of the Capital Markets Authority a statement that we categorically refute. To date all actions carried out by Cytonn are done after getting the requisite approvals from the Authority. The statement in its plain and ordinary meaning implies that Cytonn is hard-headed with no intention of working together with the regulator for the benefit of its investors which is not true as evidenced by all correspondence between the Authority and the company.

Further, only Cytonn Asset Managers Limited, CAML, deals with the public. Cytonn Investments Management (CIM) does not deal with the public at all.

  1. Misleading Presentation to the Committee on Finance and National Planning

In pages 8 and 9 of the Report to the Committee on Finance and National Planning, you mention that you were unable to bring Cytonn’s unregulated products under regulation hence your forwarding the complaint to the Capital Markets Financial Investigations Unit (CMFIU). We find this allegation to be laced with malice as Cytonn High Yields Solutions (CHYS) having been in operation since 2014 is a fact that was well within your knowledge, the Authority’s and its agents. The Authority has on numerous occasions engaged Cytonn Investments Management (CIM) through various correspondences (see attachments) in an attempt to ensure that CHYS is operating in accordance with the provisions of the Capital Markets Act and The Capital Markets (Securities) (Public Offers, Listing and Disclosures) Regulations, 2002. Throughout the years, the company has faithfully complied with all the requirements that were put across by the Authority including the change of name from Cytonn Cash Management Solutions to CHYS, a name that you sanctioned and directed be advertised to the public.

As proof of sanction by law and the Authority, we wish to rely on the following correspondences:

  1. Our letter to CMA dated February 17, 2016 in which we wrote to you, Wycliffe Shamiah, and asked for a meeting “to explain our private markets business so that you may advise whether the offerings that we may conduct during our operations satisfy your stipulations of a private offering.” See Attachment A.
  2. On April 14, 2016, you confirmed what constitutes a private offer vide your response wherein you said, “As you had observed, an offer will be considered a private offer if it meets any of the conditions provided”. Attachment B
  3. On August 31, 2016, you finally granted us the aforementioned request for a meeting and we met yourself including your then CEO, Paul Muthaura, and explained our business. Attached are the minutes of the meeting and the thank you note. Attachment C1 and C2
  4. In June 2018, the Authority asked that we change the name from the then Cytonn Cash Management Solutions, CCMS, to the current name, Cytonn High Yield Solutions, CHYS.
  5. On June 20, 2018, we got approval from the CHYS Board of Investors to change the name to what the Authority preferred. Attachment D
  6. On July 5, 2018, we took out a newspaper advert in the Daily Nation, at your request, and announced to the public that CCMS had now changed its name to CHYS. The advert read, inter alia, “…we have been engaging with the regulator… as part of that process, we shall be renaming Cytonn Cash Management Solutions to Cytonn High Yield Solutions, CHYS”. Attachment E

As demonstrated above, CHYS as a private offer was duly vetted by the Authority under your leadership Mr. Shamiah as the then Director of Market Operations. The naming was co-created with the Authority under your leadership.

  1. In your committee report, sections 5.4.5 and 5.4.6, you also mislead the finance committee that Cytonn refused to transition CHYS into CHYF, yet you are aware that vide your letter dated December 27th, 2019, you abruptly interfered with the agreed upon roadmap throwing the entire transition exercise into a halt;
  2. In your committee report, section 5.4.7 you misled the committee that Cytonn DREIT did not proceed because HF terminated their contract to offer REIT trustee services, yet you are well aware that HF demanded from Cytonn Kshs. 100 million in deposits in order to offer services. We wrote to you on this matter and you have not responded to date;
  • In your committee report, section 5.4.3, you mislead the committee that there are cases pending before professional bodies against Edwin Dande, Patricia Wanjama and Elizabeth Nkukuu, yet there are no such complaints at all;
  1. In your committee report, section 5.4.7, you misled the committee that Cytonn obtained orders ex-parte, yet the orders were obtained in an interpartes hearing, it appears your goal here is to taint the judiciary, which has checked your penchant for irregularities and illegalities.

Based on the foregoing, the statements by yourself that we are unapproved are false, and proof of unbecoming conduct by a regulator and to be specific its Chief Executive Officer, yourself, Mr. Shamiah. The ill-intentioned statements have caused confusion by portraying the company as an illegal operation and thus caused damage to the Cytonn brand which we have painstakingly built through the years. This has resulted in financial damage by causing loss of business to the firm, and we shall hold you personally accountable for the loss.

Your statements in their entirety are likely to be interpreted by the right-thinking members of the public and in specific potential investors to mean that Cytonn Investments is an illegal operation. This is a false statement and one without basis as by way of our attachments we can prove our adherence to the various requirements put across by the Capital Markets Authority and the law.

Purporting and insinuating that the company is operating without the sanctioning of the law is malicious, false and harms the firm’s brand. This has the effect of, and indeed it has caused damage to the business by discouraging potential investors and causing the existing ones to pull out their investments. The accusations by yourself simply put are outrageous and it is unseemly and unethical of you to make such scandalous claims without basis or proof.

These staged, well-timed and libelous acts are intentionally and maliciously designed to damage the reputation of Cytonn, a reputation which we have painstakingly built over time in the marketplace, and divert business away from Cytonn. Through uttering the defamatory statements and publishing the same or causing to be published on both print media and CMA’s website both of which have wide viewership and readership, poses a serious threat to Cytonn’s reputation placing in jeopardy the interests of our clients as well as stakeholders.

We also believe that your public stunts and incoherent utterances are knee jerk reactions for self-preservation and exonerating yourself, rather than providing leadership and direction to the market to protect investor interests.

In as much as the Constitution of Kenya guarantees you the freedom of speech, the freedom cannot be used in a manner likely to cause harm to another’s right. Your statements are neither a fair comment on your part nor part of your exercise of your right of speech and expression as envisaged in the Constitution. Your sentiments squarely fall within the threshold of defamation for being false, negligent and malicious.

  1. Legal Proceedings

In order to protect Cytonn’s interests we are considering proceedings against you in the High Court at Nairobi Civil and Tax Division. The proceedings would seek remedies including but not limited to the following:

  1. A permanent injunction restraining you Mr. Wycliffe Shamiah and the Capital Markets Authority as a whole, whether by yourself, agents, successors and/or assigns from publishing any further defamatory statements about Cytonn, its investment vehicles and or any of its subsidiaries and affiliates,
  2. That you pull down with immediate effect the defamatory statements and related threads from The Authority’s website in their entirety due to its damaging effects;
  3. To have you issue a public Apology stating that the allegations in your articles are false and defamatory and have the declaration published on your platforms;
  4. You admit liability for the damage caused by your statements and conduct;
  5. Liquidated damages from the date of publication of the initial statements; this letter serves as our first initial Cease and Desist Notification issued to yourself;
  6. General Damages for breach as well as for hate speech;
  7. Interest on [5] and [6] above at court rates;
  8. Costs of the suit.

We shall also be instituting through appropriate processes, your removal from office based on the following grounds

  1. Continuous misleading the public about the legality of Private Offers, which are provided for in the regulations and confirmed by your letter dated April 6th, 2016;
  2. Your continued partisan application of policy and then regulations,
  • Continuous violation of Fair Administrative procedures,
  1. Lying to the Kenyan Public, the Parliamentary Committee on Finance and Planning and the National Treasury;
  2. Willfully failing to put into place appropriate policies to facilitate the financing of the President’s housing agenda;
  3. Failing to provide regulations that would enable the registration of Corporate Trustees.
  4. Next Steps

In responsibly defending Cytonn’s right and in protecting our interests, we will consider desisting from issuing legal proceedings against you provided that within Ten (10) days of the date of this letter you agree to do the following and where we therefore DEMAND THAT YOU:

  1. Cease and desist with immediate effect and with no costs payable by us, from the publication of defamatory statements against Cytonn on your social media platforms;
  2. Immediately pull down or cause to be pulled down and permanently delete with immediate effect the defamatory articles and related threads from your social media platform (YouTube) in their entirety due to its damaging effects;
  • Issue a public apology acknowledging the defamatory nature of your articles and have it published on your social media platforms;
  1. Confirm with us in writing within seven (7) days that you have complied with the above.

We trust that you shall find our demands as justified in view of the repeated assaults made on Cytonn’s character by yourself, and take a practical view of the reputational damage and confusion you have caused in the minds of our clients and the public at large.

You are hereby advised.

Yours Faithfully,

For: Cytonn Investments Management Plc

Edwin H. Dande

Authorised Signatory


Edwin H. Dande



Leave a Comment

Your email address will not be published. Required fields are marked *

Follow @ehdande