NAIROBI, Kenya, Feb 19 – The Capital Markets Authority has found David Tumaini Maena guilty of irregular trading of Government securities in 2016 and 2017 and fined the trader Sh166.9, double the amount he is accused of embezzling.
In a statement, the Authority said investigations had established a scheme where fixed income dealers at investment banks, asset management firms and brokerage firms colluded with individual bond facility holders.
CMA Board said Maena was a key player in the scheme that saw him illegally gain Sh83.4 million by trading ahead of his clients’ accounts in bond transactions that he facilitated as a broker.
“The investigation further established that the gains arising from these trades would be shared between fixed income dealers and the bond facility owners in contravention of the capital markets legal and regulatory framework,” said the Authority.
In addition to the fine, the CMA Board has a result disqualified Maena for 10 years from holding office in a listed company, issuer, licensee or any approved institution of the Capital Markets Authority.
The case has also been forwarded to the Director of Public Prosecution (DPP) for consideration of criminal investigations on market manipulation and the Asset Recovery Agency to, “trace assets allegedly bought with the illegal capital gains; and the Institute of Certified Investment and Financial Analysts for consideration of disciplinary action for professional misconduct.”
CMA said Maena was given a chance to appeal the investigation findings but failed to do so.