CMA also requires all online foreign exchange brokers or money managers not licensed by the Authority to cease and desist from trading, conducting sensitizations in Kenya and onboarding Kenyan investors or managing online foreign exchange portfolios.

The CMA Chief Executive, Mr Paul Muthaura, pointed out the Authority has regulatory oversight over all entities offering online foreign exchange brokerage services in Kenya, which includes supervision of such entities. Mr Muthaura observed several individuals and entities are carrying on or purporting to carry on the business of an online foreign exchange broker or a money manager without the relevant license by the Authority.

Mr Muthaura said, ‘’In accordance with provisions of Section 23(1) of the Capital Markets Act and the Capital Markets (Online Foreign Exchange Trading) Regulations, 2017, the Capital Markets Authority (CMA) has issued only one license to EGM Securities Limited (formerly Execution Point Limited)to operate as a Non – Dealing Online Foreign Exchange Broker’’.

According to the Capital Markets Act, section 23 (1), ‘’ No person shall carry on business as online forex broker or hold himself out as carrying on such a business unless he holds a valid license issued under this Act or under the authority of this Act’’.

Mr Muthaura added that as per the provisions of the Regulation 3 of the Capital Markets (Online Foreign Exchange Trading) Regulations, 2017; ‘’A person shall not carry on or purport to carry on business as a dealing online foreign exchange broker, non-dealing online foreign exchange broker or a money manager unless that person has been granted the relevant license by the Authority; and a person who carries on or purports to carry on business as a dealing online foreign exchange broker, non-dealing online foreign exchange broker or a money manager without the relevant license commits an offence and risks criminal prosecution’’.

The Authority will also take appropriate enforcement action against any persons or entities illegally conducting online foreign exchange trade or collecting client funds in contravention of the above regulatory provisions.

Members of the public who have been affected or become aware of such illegal online foreign exchange transactions are advised to report to the Authority or to the Capital Markets Fraud Investigation Unit.