The Capital Markets Authority (CMA) of Kenya, an independent government financial regulatory agency, has warned its citizens against engaging in online foreign exchange (forex) trading through unlicensed platforms.
Towards the end of March, the regulatory authority stressed to citizens of Kenya that if they invest with unauthorised entities they are at risk of losing their investments and therefore, may not be protected by the law.
At the same time, the Kenyan regulator warned that all online FX brokers or money managers that are operating in the country without the proper licence need to cease and desist from trading and onboarding clients from Kenya.
At present, there are only three regulated brokers in Kenya – EGM Securities, which is the Kenya-based operations of Equiti Group, SCFM Limited and Pepperstone Markets.
As FortuneZ reported, EGM Securities was the first online regulated non-dealing online forex broker to launch in East Africa. The subsidiary of Equiti Group allows traders to invest in global macro opportunities such as forex, oil, gold, other precious metals and commodities.
In its statement, the CMA said: “The Authority will 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.”