Kestrel Capital East Africa CEO Andre DeSimone has resigned, even as pressure piles in the KenolKobil insider trading scandal.
DeSimone resigned on Friday during a board meeting, which is thought to be a fallout in the ongoing investigations which has tainted the image of the firm.
“The board accepted the resignation and has instructed the company to inform all appropriate authorities, including Capital Markets Authority (CMA), of Mr Desimone’s resignation,” said a statement signed by founder Charles Field-Marsham.
DeSimone’s 24-year reign was brought to a halt over alleged involvement of insider trading in the Ksh26 billion KenolKobil buyout by French firm Rubis Energie, in which broker Aly-Khan Satchu was also implicated. Mr Field-Marsham is also facing similar allegations, in which 14 accounts were flagged by the CMA over irregular practices.
The three might face charges for leaking non-public information to specific traders to buy shares before the buyout. It is illegal for insider traders to leak non-public information or using it to buy or sell securities for personal gain.
Read: CMA To Retain Ksh458 Million ‘Income’ For Insider Trading Suspects In KenolKobil Takeover Deal
In the allegations, Aly-Khan Satchu and co-accused allegedly positioned five investors o gain 53.6 percent of their investment in the buyout, amounting to Ksh455.9 million. The five include Abdul Sheik, Nureen Moledina, Farzeen Jamal, Adrian Tiwari and Anad Radia.
Charges against KenolKobil CEO David Ohana were dropped after investigations failed to prove misconduct against him.
CMA last month announced that it would withhold Ksh458 million that the brokers and the investors were to gain.
“The funds surrendered to date relate to 90 percent of the quantum of suspicious trades identified… The recovered funds will be paid into the Investor Compensation Fund. Upon review of the investigation findings and recommendations, the CMA Board has resolved to initiate enforcement proceedings against the Kestrel Capital executive director Andre DeSimone, Kestrel Capital chairman and founder, Charles Field-Marsham, and their stockbroking agent, Aly-Khan Satchu, through issuing Notices to Show Cause,” read the statement.
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