NAIROBI, Kenya, Mar 20 – Investors who lost their money when stockbroker Discount Securities Limited (DSL) was put under statutory management will be compensated starting April 1, 2015.
According to the Capital Markets Authority (CMA) this is the second and the final phase of compensation which is expected to last three months.
The exercise will also address the transfer of shares to other Central Depository Agents (CDAs) for investors who still have their shares under the custody of DSL.
“CMA procured the services of Co-operative Bank of Kenya in February 2012 to process and disburse funds to investors. We also transferred all details of share accounts to them to enable investors initiate the transfer process at any bank branch nearest to them,” CMA acting CEO Paul Muthaura explained.
The authority has stressed that investors who will not have submitted claims by June 30, 2015 will forfeit their claims.
Further, those who would not have transferred their shares by June 30 this year will also have their securities deemed as unclaimed and these may be transferred to the Unclaimed Financial Assets Authority.
There are over 10,000 investors who are yet to lodge their claims for compensation.
Since the first phase of compensation to investors kicked off in February 2012, at least 4,324 investors have been compensated.
“We have paid out a total of Sh84 million, which translates to 26 percent of the total creditors of DSL,” Muthaura said.
In order to receive compensation, genuine claimants are expected to visit Co-operative Bank with identification documents, Central Depository Account Statements, and evidence of claims against Discount Securities Limited in order to lodge a complete claim.
Compensation of investors is done through the Investor Compensation Fund, established for compensating investors who suffer pecuniary loss resulting from the failure of a licensed stockbroker or dealer to meet their contractual obligations.
An investor can receive up to a maximum compensation of Sh50,000 as provided for under the law.