The Capital Markets Authority (CMA) has cautioned Ugandans against dealing in securities through unlicensed entities or entities that are not approved, some of whom maybe operating through online platforms, as they risk losing their investments.
A security means shares, bonds, debentures, options, notes, depository receipts, derivatives, or investment contracts among others.
The CMA has noted a rise in fraud related complaints mostly from unlicensed persons and entities – some of whom operate online.
The CMA Act gives the Authority powers to among other things, license investment advisers, securities brokers and fund managers as well as grant approval to any entity that wishes to sell securities to the public.
Furthermore, the Collective Investment Schemes (CIS) Act, 2003 also gives CMA powers to authorize the operation of a CIS as well as license CIS managers.
Any person who undertakes any of these activities without approval or a license from the Authority is in breach of S.19 and S.30 of the CMA Act, and is liable to prosecution.
All persons offering capital markets services (a list of which can be accessed on the website; www.cmauganda.co.ug) are required to have a valid license or approval issued by CMA.
The public is encouraged to verify on the CMA website the licensing or approval status of any entity providing capital market services or offering securities before, committing hard earned resources for investing.
“All brokers or investment advisors involved in the process of offering securities to persons in Uganda require a license issued by the CMA. The Authority, in conjunction with the Uganda Police Force, will take appropriate enforcement action against any persons or entities illegally collecting funds from unsuspecting members of the public purportedly for investment,” Keith Kalyegira, CEO of the CMA said.
“Anyone that has been affected or has become aware of such illegal services is advised to report to the Authority to aid investigations. The public is urged to be vigilant and exercise utmost caution when making financial investments,” he added.
Kalyegira urged Ugandans with any complaints relating to such unlawful operators and activities through E-mail: ms@cmauganda.co.ug for appropriate action to be taken.
