
The Capital Markets Authority (CMA) is holding talks with Genghis Capital Limited with a view to reaching an agreement on how the firm intends to settle a Ksh 355 million (US$2.74 million) loan.
Genghis Capital’s assets have been put for auction over the debt owed to a South African entrepreneur, Auswell Mashaba. The investment bank was also unable to stop Moran Auctioneers from seizing its office equipment for sale to recover the debt.
The move came after High Court Judge Alnashir Alee Visram declined to certify the application of the stockbroker as urgent. The legal battle stems from a loan of US$2,265,000 (Sh293.08 million) that Mashaba issued to Genghis Capital on January 25, 2017, with an interest rate of 7.25 per cent.
After failing to repay the money, Mashaba sought a judgment for $3,100,000 (Sh401.13 million) and continued interest.
Court records reveal that former Managing Director of the stockbroker, Geoffrey Gangla admitted the default on February 18, 2020. An agreement signed later on October 18, 2021, stipulated that Genghis Capital would pay US$2,950,000 (Sh381.75 million) plus interest from October 15, 2020, with specific payment deadlines.
However, the company only managed to pay Ksh 114.35 million (US$1,115,565) leading to the current auction proceedings. The auctioneer has listed office items for sale such as furniture, electronics, and office equipment, in an attempt to satisfy the debt.
This includes 16 desktops, 13 metal cabinets, 17 wooden cabinets, a five-seater leather sofa, two television sets, a fridge, and multiple laptops, chairs, and desks.
In a desperate move to halt the auction, Genghis Capital sought legal intervention. The firm went to court to block the sale. An order from the High Court dated January 14, 2025, instructed the auctioneer to sell the attached properties after a 15-day notice period.
CMA says the scenario underscores the financial pressures facing some investment banks in Kenya, highlighting the risks involved in high-stake financial engagements. “CMA would like to clarify that clients’ assets are held in segregated accounts separate from the funds of Genghis Capital Limited,” it stated in a press release.
Genghis Capital offers Investment Bank Services, and Asset Management Solutions. It is licensed by the CMA and the Retirement Benefits Authority (RBA).
The operations of the Genghis Unit Trust Scheme are regulated under the Capital Markets (Collective Investment Schemes) Regulations 2023, which require clear separation of the roles of the fund manager from those of the custodian and trustee.
Client assets managed under the Genghis Money Market Fund and Mali Money Market Fund are held by a duly authorised custodian and oversighted by an independent trustee.