Real estate cum investment firm Cytonn seeks to gag client

by Wakili Liam
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Edwin Dande, CEO Cytonn Investments Management Plc

Real estate and investment firm Cytonn Investments has sent a cease and desist letter to one of its clients for defamation.

The letter sent to a John Bosco Matheka (Jaybee Matheka) accused him of publishing defamatory articles against the firm.

“It was brought to our attention that you without proof or reasonable presumption on which to base your statements, published or caused to be published under your social media platforms various articles seeking to discredit the authenticity of the company and its operations’, the cease and desist notice read in part.

According to sources, John Bosco Matheka is a pilot and one of Cytonn’s clients who are irate and anxious about their investments that have been stuck with the firm since April 2020.

‘Cytonn Investments has chosen to sue a Kenyan pilot after he chose to vent his frustrations with the company on his social media pages over their failure to commit to refund his investments with the firm running into millions of shillings. Do you think Cytonn has any moral justifications to do this?This case should be very interesting for would be investors in Kenya’, Jaybee Matheka posted on his Facebook page.

Cytonn blamed the lack of payment of dues to ‘reduction in construction activities’. This came at a time when the covid-19 pandemic was just starting.

“Reduced construction activity, closure of lands offices and slowed purchase of real estate units” are the reasons cited by Cytonn Investments, “for extending maturities for this fund 90 days- a period within which it expects its construction sites to reopen,” according to a statement by Mr Edwin H. Dande, CEO Cytonn Investments Management Plc.

By September 2020, the firm was separately sued by businessmen.

In a suit at filed the High Court in Nakuru, Kenneth Maweu Kasinga, through Konosi and Company Advocates, has sued Cytonn Investments over his unpaid investment dues.

In his affidavit, the plaintiff argues that Cytonn failed to honor the investment agreement that stated that he was to be made a partner and that Cytonn would process payments for his investments within three working days upon his investment’s maturity.

At Nairobi’s High Court Commercial and Admiralty Division, George Kirigi Thogo filed an insolvency petition. Mr Kirigi who had invested Sh12,994,883 wanted the firm wound up over failure to pay Sh14 million upon maturity of funds in one of its pools.

In December 2020, three businessmen wrote to Cytonn demanding over Sh6 million arising out of an investment they made in the company failure to which they have threatened to file a winding-up petition against the company in 21 days.

“Take notice that if the aforementioned amounts are not remitted to us in full within 21 days from the date of receipt of this Notice, time being of the essence, you will be deemed to have been unable to pay your debts within the meaning of Section 514 (1) (b) of the Insolvency Act.” According to the Star Newspaper.

In September 2020, having waited for their investments in vain, investors filed complaints with the Capital Market Authority (CMA) against Cytonn for failure to pay Sh122.8 million upon maturity of funds in one of its pools.

The 13 investors claimed Cytonn had delayed payments of between Sh500,000 and Sh25 million. This prompted CMA to petition the courts in the push to bar Cytonn from putting more cash in real estate projects.

The regulator expressed its concern that Cytonn High Yield Solutions (CHYS), one of the funds managed by the firm and debt security raised from investors dubbed Cytonn Project Notes pose risks to investing public.

Cytonn Investments has chosen to sue a Kenyan pilot after he chose to vent his frustrations with the company on his…

Posted by Jaybee Matheka on Monday, 25 January 2021

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