NAIROBI, Kenya, Jan 29 – Motor dealer Kai and Karo has suspended its fundraising campaign after surpassing the $100,000, or about Sh13 million, mark, citing legal challenges and negative media publicity that have crippled its operations.
The company’s founder, in a statement issued Wednesday, revealed that he was rearrested at Milimani Law Courts and held overnight at Parklands Police Station on a separate matter.
“Yesterday, after attending a mention at Milimani Law Courts, I was re-arrested and held in Parklands Police Station overnight on another matter,” he stated, adding that despite efforts to resolve issues amicably and ensure deliveries, continued police involvement and media scrutiny have made it difficult for the company to function.
The statement further confirmed that all company offices had been shut down, with the CEO currently awaiting plea taking at Milimani Law Courts.
“I have had an impressive ten-year run in business with zero criminal cases pertaining to cars, and thousands of people have successfully bought vehicles from me,” he stated.
The motor dealer’s WeFunder campaign, aimed at raising capital, was shut down on Monday night after crossing $100,000.
However, the CEO remains optimistic and has appealed directly to supporters, former clients, and associates to contribute financially in what he described as a fight against unknown forces sabotaging the company.
“All is not lost, however. I am directly appealing to my supporters, friends, old clients, and associates to chip in whatever amount they can and give us a fighting chance,” he said, emphasising that proceeds will be considered donations, not investments.
The Capital Markets Authority (CMA), under Article 3(2) of the Capital Markets (Investment-Based Crowdfunding) Regulations, 2022, enacted under the Capital Markets Act, regulates crowdfunding initiatives involving investments.
The law requires that any platform facilitating investment-based crowdfunding must be licensed by the CMA to protect investors and ensure transparency.
While donation-based crowdfunding does not fall under the same stringent regulations, any public fundraising effort that resembles an investment solicitation may attract regulatory scrutiny.
He assured donors that once the legal battle is settled, the company will release a statement and an audit trail detailing how the funds will be utilized to rescue the business.
Kai and Karo has been a prominent name in the car dealership industry, but its recent legal troubles have cast uncertainty over its future.
