Justice George Odunga found that Mr Ciano had been taken through a faulty disciplinary process.
He said the regulator had not furnished the former Uchumi boss with the required information in time to enable him prepare for his defence.
The Capital Markets Authority (CMA) had based its charges on a forensic audit report by KPMG, which found, among others, that Mr Ciano and his wife were among Uchumi’s largest vegetable suppliers.
Former Uchumi Supermarkets #ticker:UCHM chief executive Jonathan Ciano has been freed of a two-year legal burden after the High Court dismissed fraud charges against him over a flawed Sh895 million cash call in 2014.
Justice George Odunga found that Mr Ciano had been taken through a faulty disciplinary process, saying that the regulator had not furnished the former Uchumi boss with the required information in time to enable him prepare for his defence.
The Capital Markets Authority (CMA) had based its charges on a forensic audit report by KPMG, which found, among others, that Mr Ciano and his wife were among Uchumi’s largest vegetable suppliers.
“The current state of the law places the onus on an administrative body or authority to furnish the person against whom allegations are made with the information…to be relied upon in making the decision or taking the administrative action,” Justice Odunga ruled on Tuesday.
The Capital Markets Authority (CMA) had argued that Mr Ciano did not ask for more time to prepare his defence.
The regulator had hit Mr Ciano with a Sh5 million penalty for the loss that his actions were deemed to have caused shareholders and sought to seize some Sh13.5 million as proceeds of crime because he failed to declare a conflict of interest to the Uchumi board.
Mr Ciano had claimed in the court documents that he was presumed guilty even before trial, a decision that contravened his right to be heard.
But the CMA held that it had accorded Mr Ciano enough time to respond to the issues raised and that it has a statutory duty as the regulator of a listed firm to investigate, determine and even prefer charges in the manner it did.
The judgment comes a few weeks after the CMA drew fresh charges against former directors of Uchumi Supermarkets in the wake of a High Court decision that quashed penalties imposed two years ago.
