The Capital Markets Authority (CMA) has clarified and confirmed that Chipper Technologies Uganda Limited is a licensed broker after it was petitioned over a brokerage license it issued to them last year to invest in US stock markets.
A concerned citizen, Mr Samuel Obedgiu petitioned Capital Markets Authority (CMA) over a brokerage license it issued to Chipper Technologies to invest in the US stock markets.
In the petition, Obedgiu raised concern over Chipper technologies operations in the market, tasking officials at CMA to explain how the firm is encouraging Ugandans to invest in global stocks without issuing a prospectus as required by the CMA Act.
“The Capital Markets Authority’s attention has been drawn to an article titled: “Capital Markets petitioned over Chipper Cash global shares” that appeared in the Daily Monitor newspaper on Thursday, March 31st 2022 on page 31,” CMA wrote in a statement.
“The CMA confirms receipt of a written inquiry from Mr. Samuel Obedgiu. A similar inquiry was circulated on twitter by an account named ‘Strike Machine@MACHINEmakproj1,’” it adds.
Mr Obedgiu also noted that, among other issues, Chipper Cash had obtained a brokerage license from CMA yet the company has not utilised it and is not involved in any brokerage business at Uganda Securities Exchange (USE).
“Chipper cash is offering securities to the public in Uganda without a prospectus. This [is] contrary to the law,” the petition reads in part.
Therefore, Obedgiu wrote, CMA must conduct investigations on grounds that it might suspect that it may be necessary to prohibit Chipper Cash from trading in securities.
The CMA replied; “This is to inform the public that “Chipper Technologies Uganda Ltd”, was licensed by the authority as a broker on 26th August 2021. Consequently, the firm applied for membership of the Uganda Securities Exchange (USE) as a broker. The firm is required to always comply with the Capital Markets (Advertisements) Regulations, 1996.”
“The inquiry received by the Authority refers to “Chipper Cash International Ltd” which is not licensed or approved by the Authority.”
One of the functions of CMA is to approve prospectuses and offering documents under which securities are offered to the public.
A prospectus is a notice, circular, advertisement or other invitation offering to the public securities for subscription including an offer of shares/securities.
