Ciano, other ex-Uchumi officials barred from holding office in public firms, to pay Sh21.7m


Former Uchumi chief executive Jonathan Ciano. PHOTO | FILE

The Capital Markets Authority has hit former Uchumi Supermarkets directors and managers including ex-chief executive Jonathan Ciano with penalties totalling Sh21.7 million for their roles in conning investors through a flawed rights issue held in 2014.

Mr Ciano, together with former Uchumi chairman Khadija Mire, finance manager Chadwick Okumu, former directors James Murigu and Bartholomew Ragalo have also been banned from holding office in any publicly listed company.

The markets regulator has also barred Faida Investment Bank from carrying out any advisory services for six months for acting as lead transaction adviser and sponsoring stock broker ill-fated Sh895 million Uchumi cash call.

“On findings of conflicts of interest, the former CEO (Jonathan Ciano) was established not to have disclosed his conflict of interest involving Uchumi business partners,” CMA said in statement.

“The published Uchumi rights issue information memorandum was established not to have been updated with the material developments at Uchumi necessary to give investors the full picture of the impact of the funds raised through the rights issue,” CMA said in a statement.

Conflict of interest

CMA has slapped Mr Ciano with a financial penalty of Sh5 million and will also seize Sh13.5 million deemed as proceeds of crime as he did not declare conflict of interest to the Uchumi board.

A forensic audit by KPMG established that Mr Ciano and his wife were among Uchumi’s largest vegetable suppliers.

Ms Mire, the former Uchumi chair, has been ordered to pay CMA all the board allowances she earned during her two-year tenure totalling Sh1.77 million.

Mr Murigu, currently an executive director at Metropol, was also hit with a fine of Sh660,000 being the pay he received as director at Uchumi.

The regulator has ordered Mr Ragalo to pay the Sh855,000 he earned as board member.