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{
    "id": 1337602,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1337602/?format=api",
    "text_counter": 96,
    "type": "speech",
    "speaker_name": "Funyula, ODM",
    "speaker_title": "Hon. (Dr) Ojiambo Oundo",
    "speaker": null,
    "content": " Thank you, Hon. Speaker. I stand to support the Report by the Public Petitions Committee and the amendment by Hon. Atandi. Investments in real estate are expensive undertakings. As such, many investors look for innovative ways and look at the cocktail of investment options available to them. The case of Cytonn Investments is a case of pooling funds so that they can invest in any real estate asset for purposes of capital appreciation and rental income. In this case, Cytonn Investments went out of their way, set up various funds and investment schemes, and then invited members of the public to subscribe and pay some money for purposes of development and paying along the line as development goes on. This is some kind of a pre-sale or sale on paper. In this case, many cases go wrong. Many of them have been executed successfully, but some cases go wrong. In the case of Cytonn Investments, something went wrong. If you peruse the Report of the Committee, you will note that it clearly highlights some of the shortfalls of this approach. One, there is no guarantee of return on investment. If there is any guarantee, the guarantee is tied in mortar and bricks, which may not be a solution. Two, this kind of arrangement is not regulated anywhere. It is a non-regulatory investment. Consequently, there are no balances and checks to ensure the security of investments. It is upon this understanding that one of the recommendations of the Report is to call upon CMA to institute regulations that somehow rope in those people. Those kinds of investments are becoming popular as borrowed from the USA and, to some extent, the United Kingdom. I invite the Departmental Committee on Finance and National Planning to pursue one of the far-reaching recommendations to the end: the recommendation on regulations. This kind of arrangement is inevitable and is a progressive approach to raising funds for real estate investment. Therefore, we need to have regulations. If an organisation states that it will collect funds to undertake a project, it is incumbent upon it to ensure that it delivers. The many cases of stalled projects and delayed completions are hurting many investors in this country. I agree with the recommendation that those directors who hold fiducial responsibility in Cytonn Investments and the plethora of Special-Purpose Vehicles (SPVs) should be held personally responsible to the extent of the culpability so that we can solve this problem once and for all. The allure of owning a house and paying over a long period makes everyone very culpable. It is very sweet. As Hon. Ferdinand has said, you cannot resist. They often send outstanding marketers, very sweet, good-looking girls, and well-dressed men to sell to you. If they approach Hon. Wanyonyi, I know…"
}