The Capital Markets Authority (CMA) takes enforcement action against Board Members of Real People Kenya Limited (RPKL) and Real People Investment Holdings Limited (RPIHL) South Africa for the misapplication of Ksh1.3 billion Medium Term Notes (MTN) proceeds raised in 2015.
Nairobi, 31 March 2021…In line with its investor protection mandate, the CMA has taken enforcement action against former board members of RPKL (the MTN Issuer) as well as current and former board members of RPIHL, South Africa (Shareholder of the MTN Issuer) for their role in the misapplication of the Ksh1.3 billion MTN proceeds.
CMA has taken enforcement action against:
Mr. Arthur Arnold, the RPKL Board Chairman at the material time, who has been fined KES 5 million and disqualified from being director or key personnel of any issuer, licensed or approved person in the Kenyan capital market. The disqualification will only be lifted once the MTN holders recover their money in full together with the accrued interest.
Neil , a RPKL Board Member and Chief Executive Officer of RPHIL at the material time
, RPIHL Board Member and Group Chief Finance Officer at the material time
Mr. Bruce Schenk, the alternate director to Neil Grobbelaar on RPKL board and Executive Director of RHIPL at the material time who has been fined Ksh2.5 million and disqualified from being director or key personnel of any issuer, licensed or approved person in the Kenyan capital market. The disqualification will only be lifted once the bond holders recover their money in full together with the accrued interest.
In 2015, CMA had approved a Ksh5 billion MTN Programme to be issued by RPKL. The first tranche issue of KES 2.5 billion raised Ksh 1.6 billion. Immediately thereafter,
After the conclusion of the Administrative hearings, the Ad hoc Committee determined that that there was lack of effective oversight on the part of RPKL board on the application of MTN Proceeds. The approved and published Information Memorandum (IM) dated June 25, 2015, provided that the MTN proceeds would be used by RPKL for lending to clients in the small and micro sized enterprises (MSME) sector in Kenya. On the contrary, MTN proceeds were used to settle
No enforcement action was taken against Mr. James Mwai Mbui, former RPKL Chief Information Officer, Mr. Bruce Evans, former RPIHL Group Head of Corporate Finance and Mr. Werner Nel, former RPHIL Group Head of Treasury.
BACKGROUND INFORMATION ON THE CAPITAL MARKETS AUTHORITY