The Capital Markets Authority (CMA) has requested High Court’s commercial and admiralty division to throw out a petition by Cytonn Investment in which it is listed as a respondent.
In a new affidavit dated October 23, the capital markets regulator accuses Cytonn of failing to exhaust all remedy channels to resolve its dispute over the utilization of proceeds from a fund it manages before heading to court.
On June 3 this year, the CMA failed to grant the investment firm an exemption allowing it to invest up to 80 per cent of funds in the Cytonn High Yield Fund (CHYF) in its inhouse real-estate projects sighting exposure risks.
Cytonn however moved to court to protest the ruling while accusing the regulator of malice sparking an all out war between the pair.
In its court filings, Cytonn has indicates it should be allowed to invest up to 80 per cent of funds in its housing projects arguing the fund’s trustees are independent of its own operations.
CMA is now accusing Cytonn of failing to raise its objection with the Capital Markets Tribunal which handles disputes arising from the regulator rulings on its licensees.
Additionally, CMA has revealed investors in Cytonn High Yield Services (CYHS)- a privately managed fund have continued to file complaints over defaults on scheduled payments as it points to the company’s underlying exposure.
In its counter argument Cytonn has accused the CMA of using an unrelated issue to its petition to drag its reputation in the mud insisting investors in the CYHS had reached a deal allowing for a freeze on payments.
“CHYS is a different fund, not regulated by CMA and has nothing to do with the matter in court. CHYS is a fund invested in real estate and whose board of investors approved an extension of maturities by 12 months for Pre-COVID funds. The decision is binding to all CHYS Pre-COVID investors. Out of 4,000 investors, about 13 of them were unhappy and approached CMA, and that is the letter that is making rounds in the news,” Cytonn said in an earlier statement.
In recent weeks, Cytonn Investment Chief Executive Officer Edwin Dande has tore into the CMA, accusing the regulator of running a backward capital markets regulatory regime.
Credit: Source link