NAIROBI, KENYA: Retail investors who have been lining up to buy long-term shares stand to lose their accounts if they do not keep their trading accounts active. The Central Depository & Settlement Corporation (CDSC) Ltd has outlined regulations that would freeze dormant accounts within two years.
CDSC yesterday invited input from the public on the guidelines that will regulate the declaration (and lifting) of dormancy on CDS accounts to further safeguard investors’ holdings in CDS accounts. “The rules provide that a CDS account (individual or corporate, local or foreign) will be declared dormant following a period of 24 months of continuous inactivity,” CDSC said in a notice in the dailies.
Under the proposed law, you can reactivate your account via mobile phone application or on the CDSC website. If a shareholder wants to renew their accounts through Central Depository Agents (CDA), they will need to give a written statement with a copy of their identification.
The move seems to be targeting money-laundering activities in the stock market . In 2013, Central Bank of Kenya issued prudential guidelines for institutions licensed under the banking Act which cited shares as a conduit for money laundering.