•CMA has said the platform was unlawfully collecting funds from investors and is now cautioning the public against participating through it.
•On its website, however, Interweb Global Fortune stated to be registered under the Companies Act 2015 specialisation in trading and consultation.
The Capital Markets Authority has raised a red flag on online forex trading company, Interweb Global Fortune and the director Manasseh Kuria Karanja.
This follows after the authority’s Capital Markets Fraud Investigation Unit and the Directorate of Criminal Investigation conducted an operation against unlicensed and unregulated Online Forex Trading entities in the country.
“Preliminary investigations conducted by the authority have revealed that Interweb Global Fortune has been purporting to carry on business as an online forex trading broker and money manager without a valid license from the CMA,” the regulator said.
Online forex trading is conducted through the speculation of currencies through electronic devices, and whereby the person trading makes profits by buying a currency that gains value.
CMA has said the platform was unlawfully collecting funds from investors and is now cautioning the public against participating through it.
“Interweb Global Fortune’s business model features traits of a pyramid or ponzi scheme, where investors are promised high returns or dividends which are not realistically available through credible investment products. Investors have also been encouraged to recruit other people for a commission”, CMA Chief Executive Paul Muthaura said.
The authority has also frozen the company’s bank accounts pending further inquiries.
The company was said to have misled investors by claiming that it has applied for a licence from the authority.
“Contrary to the entity’s claim, the Authority has never received any application for a license to operate as an online forex broker or money manager from the Interweb Global Fortune or its directors," Muthaura added.
On its website, however, Interweb Global Fortune stated to be registered under the Companies Act 2015 specialisation in trading and consultation.
As of May, only two companies had been granted a licence in online foreign exchange brokerage services under CMA.
SCFM Limited was approved to operate as a Non – dealing online foreign exchange broker after the first licence issued to EGM Securities Limited in 2018.
In August, the Central Bank of Kenya had issued a warning against dealing with unlicensed and unregulated online forex traders.
The banking regulator said those platforms are downloadable on Google Play and Apple App Store, and aggressively market themselves through social media, promising huge and instant returns.
A spot check by the Star Newspaper on Google App store found a dozen of forex trading apps including Go Forex designed by GoForex 24, FXPesa by EGM Capital, Iron Trading, Forex Game, Trading Signal, Bimono Trade Olymp Trade among others.
Members of the public are encouraged to avoid dealing with unlicensed and unregulated financial entities as they risk being defrauded or losing their money.
"Members of the public who have been affected or become aware of such illegal online foreign exchange are advised to report to the Authority’s Capital Markets Fraud Investigation Unit or any police station," it added.