A judge has ordered the liquidation of Cytonn Investments to recover over
Sh14 billion owed to some 4,000 investors.
The liquidation of Cytonn High Yield Solutions and Cytonn Real Estate
Project Notes was mandated by Justice Alfred Mabeya. The assets and
housing developments belonging to the corporation, known as “the Alma,
Applewood/Miotoni, Riverrun, Ridge and Taraji,” were also ordered to be
preserved until the liquidation is over.
More than 3,000 investors had put more than Sh11 billion into Cytonn
High Yield Solutions (CHYS), and 886 others had put more than Sh4 billion
into the Cytonn Real Estate Project Notes, the judge said in his judgement
(CPN).
In 2020, Cytonn, a once-vibrant real estate business, failed and lost billions
of dollars in investors.
“The court must be sensitive and alive to the plight of over 3,000 members
of the public who sank their over Sh11 billion and 886 others whose over
Sh4 billion was sunk into these projects and therefore lean towards a lesser
evil, which is to preserve those assets for the time being,” he stated.
The decision allows the liquidator to sell Cytonn properties in order to
recover the money owed to the investors, who have been complaining for
more than five years
“There is evidence on record that the monies paid by the creditors of CHYS
and CPN was sank in these projects and all that CHYS and CPN has in
possession are mere pieces of paper called Loan Notes. There are no
securities held by way of charges for what the investors sank in CHYS and
CPN, who in turn sunk the same into these projects,” said the judge.
The Administrator had established that the company had no reliable
financial source, thus the judge added that there was little chance of the
firm’s fortunes changing.
