Kenya High Court: Fraud investigations into CMOs to continue

The case was filed in the court on 28 September 2020 by Francis Nzioki Kavuu, a member of the Music Copyright Society of Kenya (MCSK) and the Performance Rights Society of Kenya (PRISK). The two CMOs were enjoined in the case as interested parties alongside the Music Publishers Association of Kenya (MPAKE) and the Kenya Association of Music Producers (KAMP).

Kavuu asked that the court rule against the forensic audit report and all consequential decisions that KECOBO made based on the report. At the time, the regulator had already forwarded the report to the Directorate of Criminal Investigations to look into suspected fraudulent transactions at the licenced CMOs.

To fast-track investigations, the board directed CMO staff and board members mentioned in connection with possible misappropriation of members’ funds to step aside as required under section 46F of the Copyright Act.

High Court judge David Kipyegomen Kemei dismissed the case for lack of merit. He also vacated conservatory orders that the court had earlier granted the petitioner.

“I found it rather curious that the interested parties [CMOs] had come up with a stratagem where one of its members was used as a smoking gun to take on the first respondent [KECOBO] over the impugned forensic audit,” Kemei said.

He said KECOBO conducted the forensic audit as per the Constitution and the Copyright Act, and that the regulator was entitled to call for an audit of the CMOs to ensure they acted in members’ best interests and within the law.

“I am satisfied that the forensic audit complained of did not violate the petitioner’s rights and those of the collective management organisation under articles 10, 36 and 47 of the Constitution or any other law,” he said.

KECOBO executive director Edward Sigei welcomed the judgment and said the implementation of the audit resolutions was back on course.

In December last year, KECOBO revoked the MCSK’s operating licence after the society failed to submit a complete and authenticated list of its members and their works to the National Rights Registry database. KAMP and PRISK were allowed to continue collecting on behalf of their members, but their licences expired on 31 December.

Read the full judgement below (PDF).