BY SAM ALFAN.
Three businessmen have moved to court seeking to compel investment firm Cytonn to refund them over Sh46.7 million which they claimed to have invested in the firm.
Charles Nzioki Kanyaa, Harrison Kaloki Kanyaa, Robert Munyao Kanyaa accuse Cytonn representatives of knowingly making deceptive misrepresentation to them, well aware of the true shaky financial position of the investment firm.
The three claim that on diverse dates, the representatives of Cytonn made them believe they would receive handsome monthly returns if they invested substantial amounts with the firm.
“The Defendants’ representatives sketched a portrait of a liquid, stable and financially sound Cytonn which can be trusted by investors with colossal sums of monies, with no history of non-payment to investors,” they claim in court documents.
According to the trio, the representations were unconscionable, misleading and deceptive contrary to the provisions of the Consumer Protection Act, 2012 and amounted to unfair practices.
They claimed to have invested Sh39 million on diverse dates between 29 October 2018 and 30 October 2018 at an agreed interest rate of 18 per cent payable monthly for a period of twelve months.
Upon maturation of the investment of Sh30 million they had invested on 4 November 2019, they invested Sh42 million on representations made by the representatives of Cytonn’s of a higher and better return at an agreed interest rate of 20% per annum, payable quarterly for a tenor of two years.
“The Defendants routinely and regularly paid the agreed monthly interest, until June 2020 when in a fragrant breach of the investment agreement stopped paying the agreed monthly interest,” they claim in court documents.
They aver that Cytonn on or about the 22 of June 2020 wrote to them an email where they sought to unilaterally vary the contractual investment terms which was against the contractual terms.
“Being dissatisfied with the unilateral alteration of contractual terms, we wrote to them through our advocates, seeking a refund of the Principal sum plus all accrued interest thereof, which as at 31 December, 2020 amounted to Sh46,792,603,” they said.
According to them, Cytonn responded on 29th January 2021, citing temporary liquidity of the fund and for the very first time in their contractual relationship cited in partnership agreement as the governing document of the fund.
“The partnership document that was never availed to us at any time prior to the breach of the investment agreement…non-supply of all the governing documents to amounts to unconscionable, unfair, unreasonable, unjust or otherwise improper trade practices such as deception, misrepresentation, unfair and fraudulent conduct, contrary to the express provisions of the of the CPA,” they argue.
According to the businessmen, Cytonn is in utter breach of the investment agreement and wants the court to grant them compensation for violating their consumer Rights.
