In a press release Wednesday on November 19, 2025, CMA announced that the former CBKL Chairperson, Mr. Zafrullah Khan, was fined Ksh 5 million and barred from serving as a director or key personnel in any capital markets entity for ten years.

“Mr. Khan, as Board Chairperson, failed to exercise effective oversight, leading to the publication of false and misleading financial statements in the Information Memorandum.

He also failed to disclose material information regarding his bonus and approved it without declaring a conflict of interest,” CMA said.

The former General Manager, Finance, Mr. Makarios Agumbi, was fined Ksh 3.5 million and disqualified for five years.

CMA found that he facilitated false 2014 financial statements in the MTN Information Memorandum and authorized Mr. Khan’s lump-sum bonus payment contrary to board resolutions.

Meanwhile, former General Manager, Corporate Assets, Mr. James Mwaura, was fined Ksh 2.5 million and disqualified for two years.

CMA cited his role in misclassifying related-party loans and enabling the irregular bonus payment.

“All three individuals are required to undergo corporate governance training before being eligible for any board or key management positions in Kenya’s capital markets,” CMA added.

The 2015 MTN issuance had raised Ksh 4.8 billion of a planned Ksh 10 billion and was listed on the Nairobi Securities Exchange on 22 June 2015.

The following year, the Central Bank of Kenya (CBK) appointed the Kenya Deposit Insurance Corporation (KDIC) as receiver for Chase Bank, leading to the suspension of bond trading on April 8, 2016.

CMA conducted a thorough investigation into whether regulatory breaches contributed to CBKL’s collapse.

Key findings included false financial statements, nondisclosure of material information, and conflicts of interest.

Notices to Show Cause (NTSC) were issued to twelve board and senior management members, with nine appearing before an Ad Hoc CMA Board Committee.

“Following the administrative hearings concluded on November 17 2025, the Committee determined that Mr. Khan, Mr. Agumbi, and Mr. Mwaura breached the capital markets regulatory framework regarding the use of MTN funds,” CMA confirmed.

The trio had earlier tried to halt the proceedings through the Capital Markets Tribunal (Khan & 2 others v CMA, Appeal 2 of 2022), but the tribunal ruled in February 2024 that they must appear before the Ad Hoc Committee to conclude the enforcement process.

This decisive action by CMA reinforces its commitment to investor protection, corporate governance, and accountability in Kenya’s capital markets.

“CMA’s enforcement sends a clear message: breaches of financial reporting, conflicts of interest, and misrepresentation in capital markets will not be tolerated,” the Authority said.

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