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Why is the ‘Daily Nation’ Covering Up the CMA’s Lack of Credibility?

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Quick! Somebody check to see if an NMG reporter has been transported back in time to work at Soviet-era Pravda! Check to see if a journalist was forced at gunpoint to revise their article! Something very strange is going on, and the Daily Nation is doing its best to hide the truth.

I get RSS feeds which I check throughout the day. A new article comes in, I read the headline and decide whether I want to read further. Yesterday, under the headline “CMA Cautions Whistleblowers” was this interesting snippet:

In a statement to media houses on Wednesday, CMA chief executive, Ms Stella Kilonzo, put whistleblowers on notice warning them of dire consequences…

I was doing something else at the time, so simply marked to article as being of interest and left it for a couple of hours. Only by the time I got round to it, the article had been extraordinarily rendered from the Nation website.

I wasn’t drunk (too early) and I hadn’t imagined it. Have a look at my screenshot:

Google had indexed the article, yet clicking through to it only got a 404 error message. Somebody at Nation House had decided that Stella Kilonzo’s pig-headedly stupid gaffe should be removed from the public record before the hapless CMA executive became the object of widespread ridicule.

The CMA is an organisation in crisis. It is still acclimatising to Mrs Kilonzo after losing Chege Waruingi in January, and is also having to deal with a major scandal that has shown up its inadequacies as a regulator. Despite the leaked report, ordinary members of the public still do not know quite how bad the situation actually is. The very last thing the chief executive should be doing is threatening those who would bring wrongdoing to light. To then send this out as a missive to the media houses smacks of astonishingly bad judgement, and gives me pause to wonder if perhaps Ms Kilonzo has a conflict of interest that will prevent her from reforming the regulatory framework to prevent other dodgy deals.

What makes the situation even worse is that the Daily Nation obviously wrote an aritcle detailing what had happened, but then pulled it, hoping to minimise whatever damage they anticipated. But why? Who leaned on who to get rid of the incriminating evidence? Were NMG management worried about Kilonzo doing a Lucy?

Neither party comes out of this little event covered in glory. The CMA looks as though it is so utterly incompetent that it would rather hear no bad news rather than have to take action. The Daily Nation looks as though it has either made an editorial decision after pressure or because it wants to protect somebody. Whatever happened to “publish and be damned?”

What is most galling is that thousands of Kenyans have lost money, yet the so-called regulator is sitting on a report because it’s embarrassing and is instead gunning for those who might expose other people with questionable business practices. We’re in the middle of a bear run, Stella! People were losing confidence in the markets already, yet your actions only make it worse. Do you have hedge bets against the Kenyan economy or something? Are you determined to destroy the country from within? What, the post-election violence last year was so exciting that you wanted something dramatic for early 2009 too?

In a statement on the CMA’s website, Stella Kilonzo insists that the CMA “would like to encourage the investing public to fully participate in the capital market.” I’ll tell you what, darling: I’ll take part in the investment game when you and those you are protecting have been removed from a position of influence and somebody who actually knows what the job description means is put in charge. Regulators are there to protect the investing public, not the charlatans who caused this mess. And if the Daily Nation is too scared to acknowledge that fact, then more fool them.

[Image by Pretty n Punk]



  1. Fiona says:

    Seems as though Nation has bought into the argument that “investor confidence should not be eroded” argument.

    The Business Daily had also been told not to follow up the Nyaga PWC report because pursuing the story would erode investor confidence in the stock market.

    As I wrote in a post on accountability (, this burying of heads in the sand for the sake of keeping things “sawa” is what will continue to lead to the perpetuation of fraud and impunity in our society.

    Such a shame!

  2. Stephanie says:

    Business Daily is another publication in the NMG stable. Looks like the Nation Media Group and the CMA are in cahoots.

    What they don’t seem to understand is that lack of information also erodes investor confidence. The PwC report and the disappeared article give us a brief glimpse behind the curtain, but the CMA tweaks it back into place and tells us we don’t need to worry about it.

    But we do worry. It’s our money! If we can’t trust the people runing the markets, where is our incentive to give them our money?

    Your link doesn’t seem to work, by the way.

  3. kaivestor says:

    I have a strong feeling the Business Daily leak on the Nyaga-PWC report was intentional. getting the report has proved to be impossible and the rot at CMA would rather bury their heads and caution ‘whistle blowers’ than face the fact that they have screwed up stocks investors in Kenya. In fact, I think the media in Kenya is not the 4th estate as they would like us to believe, they don’t set the agenda but are just a mouth piece for a bunch of corrupt individuals. Business reporting is at its worst, just churning out rosy press releases of companies and organizations that are so mismanaged . . . CMS and NSE topping the list.

  4. Stephanie says:

    I’m just puzzled as to how anyone who has any type of business experience would be stupid enough to send out an email saying that whistleblowers are going to face “dire consequences.”

    I mean, really. There’s a scandal about covered-up shenanigans in both the CMA and the NSE, and the first thing you do is try to slap a gag order on the people who might be able to bring the culprits to justice?

    What was Stella Kilonzo doing before she was gifted this job? I am finding it very hard to believe she didn’t get her qualifications by sending in the right number of vouchers from a cereal box.

  5. bankelele says:

    NMG CEO is a director of an investment bank so he has an interest in protecting the industry.

  6. Stephanie says:

    Oh, what a tangled web they weave… Still, if we can’t rely on the mainstream press, how are those investors who don’t spend all day hanging around on the internet supposed to get accurate information?

    The system is broken, we need a new one, but I don’t think any substantial reform is going to take place.

  7. Godfrey says:

    I’m sorry to say this but Kenyan managers are just mediocre. The email Stella sent warning whistleblowers of “dire consequences” is the kind of cheap Nigerian TV drama that goes on in Kenyan companies everyday. No wonder LG doesn’t want to write about it because more or less the same things happen in NMG. People spend too much time on office politics at the expense of implementing company strategy.

  8. John says:

    We really need to be fair to the public and always put their needs ahead of us this kind of woes could not only cripple cma but make more investors loose confidence in the market…

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