Capital Markets Authority (CMA)
Basic Information
The Capital Markets Authority (CMA) of Kenya is the primary financial regulatory body overseeing capital markets intermediaries, including forex brokers, securities trading, and investment activities within Kenya. Established under the Capital Markets Act, CMA operates as an independent government agency under the National Treasury, ensuring market integrity, investor protection, and transparent financial practices. Its official website (cma.or.ke) serves as a central hub for regulatory updates, licensing verification, and investor education.
Historical Background
The CMA was established in 1989 and formally commenced operations in 1990 under the Capital Markets Act (Cap 485A of Kenyan law). Its creation aimed to develop Kenya’s capital markets by removing investment barriers, promoting long-term capital allocation, and safeguarding investor interests. Over the years, CMA has expanded its regulatory scope to include online forex trading, culminating in the 2017 Online Foreign Exchange Dealers Trading Code, which standardized broker licensing and operational requirements.
Legal Authority & Regulatory Framework
CMA derives its authority from Kenya’s Capital Markets Act, supplemented by subsidiary regulations such as:
- Capital Markets (Online Foreign Exchange Trading) Regulations, 2017: Governs forex brokers, leverage limits (capped at 1:400), and client fund segregation.
- Anti-Money Laundering (AML) Act: Mandates compliance for licensed entities.
- Securities Act: Covers equities, bonds, and collective investment schemes.
CMA enforces strict licensing criteria, including minimum capital requirements (KES 50 million for brokers) and mandatory monthly reporting.
Core Responsibilities & Regulatory Scope
CMA’s oversight spans:
- Licensing: Authorizing non-dealing online forex brokers, securities dealers, and market intermediaries.
- Supervision: Monitoring trading platforms, marketing practices, and AML compliance.
- Investor Protection: Enforcing fund segregation, dispute resolution mechanisms, and pre-approval of broker advertisements.
- Market Development: Promoting fintech innovation (e.g., regulatory sandbox) and investor education programs.
Notably, CMA bans binary options trading and restricts leverage to mitigate retail trader risks.
Contact Information
Headquarters Address:
Capital Markets Authority,
Embankment Plaza, 3rd Floor,
Longonot Road, Upperhill,
Nairobi, Kenya.
P.O. Box 74800-00200
Key Contact Channels:
- Phone: +254 20 2264900
- Email: [email protected] (for grievances)
- Fax: +254 20 342825
- Online Complaints Portal: CMA Complaints System (requires registration)
How to Verify a CMA-Regulated Entity
To confirm a broker’s CMA licensing status:
- Visit CMA’s official website.
- Navigate to Investor Protection > Licensees/Market Players.
- Select NON-DEALING ONLINE FOREIGN EXCHANGE BROKER for forex brokers.
- Search the entity name or browse the licensed list.
CMA updates its licensee registry regularly, ensuring transparency for investors.
