CMA bars DeSimone, Satchu from holding positions in listed firms

Capital Markets Authority (CMA) on Monday temporarily barred ex-Kestrel CEO Andre DeSimone and Mr Aly Khan Satchu from holding any key positions in firms listed at the Nairobi Securities Exchange (NSE) #ticker:NSE over their involvement in insider trading on Kenol Kobil Plc #ticker:KENO shares.

The Ad Hoc Committee of the Board of the Capital Markets Authority (CMA) has barred Mr Satchu from holding any position in a public listed company for a period of three years. Mr DeSimone has been handed a one-year ban.

The committee further imposed a financial penalty of Sh2.5 million on Mr DeSimone who they established disclosed price sensitive material on the Kenol Kobil transaction on the sale of the 24.99 percent Wells Petroleum shareholding in KenolKobil to Mr Satchu and Mr Bid.

“The two stock broking agents thereafter used the insider information to deal in the price affected shares by advising and/or buying on behalf of their various clients approximately 59 million Kenol Kobil shares in the week before the takeover announcement was made on October 24, 2018, contrary to the provisions of Section 32 B (1)(a) and (b) of the Capital Markets Act,” CMA said in a statement Monday.

The committee revealed that Mr Satchu received Sh4.7 million as commissions based on trading with the insider information that was provided. Trading accounts managed by Mr Bid earned gains amounting to about Sh23 million according to the CMA committee.

“The Committee has also disgorged Shs333,747 being the amount received by Bid Securities Ltd from Kestrel Capital E A Ltd and Sh14,569.50 being the amount received by Bid Management Consultancy Ltd from AIB Capital Ltd as the commissions from the respective trades conducted on the basis of insider information,” CMA said.

The three were being investigated of insider trading trading on Kenol Kobil Plc shares in the period before the company’s takeover announcement was made public in October 2018.

The biggest trades of KenolKobil shares were done on October 18 and 22, when 27.9 million and 29.5 million shares changed hands respectively.

The Ad Hoc Board Committee committee investigating the matter comprised of four CMA board members and four independent persons for the sole purpose of hearing and determining the allegations on the suspicious trades in KenolKobil shares.