The Capital Markets Authority (CMA) has suspended Trade Sense Limited, pausing its operations as a money manager for the next three months over breaches of its license requirements.

The firm has been licensed as a money manager, engaging in the management of online foreign exchange portfolios for individuals and institutional investors in return for a fee based on a percentage of assets under management.

The suspension follows engagements with the capital markets watchdog over breaches including governance and anti-money laundering provisions.

The suspension is expected to allow the markets regulator to complete a probe on the firm, determining whether to lift it or take further action.

“The suspension is due to the failure by Trade Sense Limited to comply with various regulatory requirements which undermines the duty to protect investors and foster market confidence,” CMA chief executive officer Wycliffe Shamiah said.

“CMA has been engaging the management of Trade Sense Limited since 2023 to address various regulatory breaches that had been identified. The regulatory breaches include non-compliance with governance, financial, anti-money laundering and operational requirements.”

Trade Sense Limited may have directly handled clients’ funds against CMA rules with the regulator highlighting the prohibition against receiving customer funds.

Trade Sense lists the requirement of a minimum investment of Sh258,380 ($2,000) for retail investors and Sh1.2 million ($10,000) for corporate and high net worth individuals, a lock-in period of 90 days for the principal invested and a management fee of three percent.

The firm says its expected rate of return on investment (ROI) stands at between 20 and 25 percent net of fees while profits are redeemable monthly.

Trade Sense lists a performance fee of 33 percent of the profit earned in addition to the annual management fee.