The High Court has directed four bloggers to pull down articles posted questioning the commodities and foreign exchange trading business of the Standard Investment Bank (SIB).
Justice Said Chitembwe directed Cyprian Nyakundi, Kahawa Tungu, Robert Alai and Business Times Kenya to pull down the articles, arguing they are defamatory and are hurting the SIB product, trading as Mansa X.
The bloggers had labelled the product a Ponzi scheme after it shrugged off effects of Covid-19 to post a net investors return of 18.75 percent last year on Wall Street’s resurgence.
Justice Chitembwe ordered the bloggers to pull down at least six articles from the internet and search engines such as Google, yahoo and Bing.
“I am satisfied that the applicant has a genuine concern considering that its core business is offering financial services and therefore thrives on goodwill and confidence it portrays with its potential and existing clients,” the judge said.
SIB moved to court to challenge the bloggers articles, terming them defamatory and lacked evidence to show that the product was likely to be a Ponzi.
The court suit came after the Capital Markets Authority (CMA) confirmed that the SIB online foreign exchange trading business is compliant following claims that it had breached the law. The regulator granted SIB Kenya’s first money manager licence in December 2018, which allows it to manage investments for its online forex trading clients and develop an appropriate investment strategy.
It closed last year with Sh3.1 billion investors’ funds, up from Sh300 million in December 2019.
Justice Chitembwe reckoned that the bloggers should have alerted the CMA to establish the fitness of the product, arguing they cannot portray themselves as protectors of consumer rights while at the same time trampling upon the rights of investors.
“Such an action would have shown how concerned the respondents are. The respondents decided to clothe themselves with the responsibility of belittling the product and paint it negatively,” the judge said.
The court heard that there was no evidence that the bloggers made any inquiries to the company or CMA.
SIB said the articles were published and republished by the bloggers, who have huge following online and since filing the case, no efforts have been made to pull the articles down.