Led by Ag CEO Dickson Ssembuya, top officials from Capital Markets Authority (CMA) spent much of Wednesday interacting with a group of business journalists who practice their journalism in Kampala. Majority of them were business journalists. Besides the Ag CEO, the other CMA officials who spoke at the Capacity Building Seminar included Dreck Murozi who presented a paper on “demystifying Capital Markets” and Terrence Tumwine who spoke about “Navigating the Capital Markets Landscape.”
Other speakers at the Seminar included Director Supervision Denis Kizito (spoke on the Complexities of Market Supervision in the world of Capital Markets) and Head Legal Joseph Magala who made submissions about the “CMA Regulatory Framework: Ensuring Market Stability & Investor Protection.” It was an interactive session during which journalists were permitted and encouraged to give feedback and ask as many clarificational questions as they desired.
With reference to the Airtel Uganda one, which was concluded recently, journalists were taken through basics regarding things like IPOs and why and how this is one of the ways through which Companies go about raising additional capital upon authorization by CMA which is the regulator of finance markets operations.
Contemporary ponzi schemes like Capital Chicken, through which Ugandans lost billions, were freely discussed with CMA officials making it clear that all such victimization and rip off can be avoided once Ugandans become more aware of their rights and regulatory mechanisms (think of CMA-authorised investment advisors) their government has put in place through agencies like CMA.
It was made clear there is no reason nor way any Ugandan can be a victim of such ponzi schemes once they reach out, seek and obtain professional investment advice and guidance from licensed operators who CMA has authorized and certified to operate in the Ugandan financial markets space. One journalist from the East African newspaper volunteered information that one of the Capital Chicken victims lost as much as Shs200m and is a senior person in the Uganda Police Force.
Journalists reflected on the need for the GoU, through regulators like CMA, to put in place a legal framework that permits the helping of such victims while at the same time inquiring into the circumstances under which a middle level Police officer would raise such money (Shs200m) without taking out a loan. Ponzi scheme is one area which attracted a lot of questions prompting seminar organizers to promise making such learning interactions and seminars more frequent going forward because, clearly, there is a lot journalists need to learn before subsequently disseminating the same to the general public.
The journalists were also told about the 105 operators or licensees/market participants who CMA currently has on its register as authorized to carry out business operations. These operate in a CMA-regulated space with a combined annual turnover of roughly Shs10trn. The possibility of CMA, working with partner government agencies like FIA, BoU and others, doing more to ensure real estate development and purchase deals aren’t used by rogue-minded actors to successfully engage in money laundering was also discussed at length with journalists suggesting ideas while at the same time listening to fascinating insights from the CMA team.
It was also revealed that, even where the law limits or restricts the exercise of regulatory authority by CMA, there is collaboration between it and other agencies like IRA, BoU, FIA, URBRA and others. These came together to meaningfully collaborate under the Financial Sector Stability Forum (FSSF) in order to make Uganda’s financial markets space safer for all players, Denis Kizito clarified.
The journalists were also made to understand the resource constraints under which CMA operates including limited funding from government which has resulted into the entire Authority having only 32 employees. Clearly, every Directorate is severely understaffed which constrains work. There is need to spread and have CMA offices in some of Uganda’s major Cities beyond Kampala but all this remains constrained because of inadequate funding.
The CMA officials also endeavored to array journalists’ fears related to the ponzi schemes being rampant in Uganda. That this is inevitable in a country whose economy is rapidly developing and transforming. There tends to be a lot of people with huge appetite to invest money so that it multiplies and makes them richer and more comfortable- in such rapidly growing economies. That proponents who come around popularizing such ponzi schemes wouldn’t be attracted to a stagnated or shrinking economy. There was realization that Uganda needs to have a law that expressly prohibits operations of such ponzi schemes unlike today when even prosecutors will have to look at many different laws to be able to prosecute ponzi-related offenders.
There was also discussion about the benefits deriving from CMA being able to prosecute finance services delivery-related offences besides enforcing the relevant provisions of the CMA Act. That, in order to enhance efficiency, the DPP allowed them to have delegated powers to prosecute like is the case with UWA, IGG, URA etc though the authority to sanction files, regarding who gets prosecuted, remains with the DPP since the same is bestowed upon that office under the Constitution.
There are cases currently being prosecuted in the Court system by CMA though its legal head Joseph Magala refused to divulge any details fearing to breach the subjudice rule. Some of the journalists and editors who have previously reported from Parliament encouraged CMA to replicate similar training seminars to cover groups like Ministers and MPs because they too require similar financial literacy to be able to do their job better while making more helpful decisions for the country.
Besides sharing contacts and promising to have regular interactions with them, the CMA officials also encouraged journalists to regularly check out the Authority’s website because it has a lot of useful content that can potentially inform and make them better journalists.
The overall coordination of the half day Capacity Building Seminar, which took place at the Kololo-based Uganda Business Facilitation Center, was spearheaded by Ms. Lyn Tukei who serves as Communications & PR Manager at Capital Markets Authority. Speaking in different sessions, journalists asked questions, made proposals on how to relate better and also unanimously commended the CMA management for being deliberate about capacitating them to report about financial matters more easily and with better clarity. (For comments on this story, get back to us on 0705579994 [whatsapp line], 0779411734 & 041 4674611 or email us at email@example.com).