The seventh state institution; the Securities and Exchange Commission (SEC), has finally succeeded in temporally shutting down the Ghanaian gold dealership company, Menzgold, effective yesterday, September 13, 2018, with the fate of over One Thousand Two hundred workers of the company at stake.
Strangely, the SEC a year ago, in a public statement dated September 22, 2017, had said it had no supervisory role over the gold company. Their recently issued directive, has, therefore left many people more confused.
Aside SEC, other state institutions such as the Bank of Ghana (BoG), the Finance Ministry, the Lands and Natural Resources Ministry, the Minerals Commission and the PreciousMinerals Marketing Company (PMMC) Ltd, have at various times, also claimed they are mandated to license and regulate the operations of the company, leaving the public confused.
The Economic and Organized Crime Office (EOCO), has also delved into the activities of the company, seeking to discover fraud and other criminal acts, but so far the public is yet to see anything incriminating against Menzgold, following a meeting between its officials and the law enforcement agency.
Indeed, till date, it is not clear, which of the seven institutions has supervisory role over the company, but the untidy situation, has led to fears that Menzgold, which has branches in Spain, London, Nigeria and about to open two offices in America, might soon go down just like Unibank, Capital Bank, UTBank, Beige Bank, Sovereign Bank, Construction Bank and The Royal Bank, with nearly Four Thousand Five Hundred (4500) workers going home.
Menzgold, in a statement said, it took the decision to help bring some finality to its seemingly unending woes.
“Following the notice from the Securities and Exchange Commission of Ghana issued on the 7th day of September, 2018, the Management of Menzgold Ghana limited in its bid to bring some finality to the issues once and for all has decided to place a temporary halt on all extra value payments and any new business related to our Gold vault market,” a statement from management of Menzgold stated.
According to the company, it is halting operations for six days with the hope that all pending issues would have been resolved by then.
“We are certain this halt would not go beyond the 19th day of September 2018. This decision, though very unfavourable to us has been informed by our commitment to the rule of law, absolute respect to state agents, agencies and total submission to the state,” the statement added.
Menzgold Ghana Limited, was asked to suspend its gold trading operations with the public by the SEC.
According to the SEC, Menzgold, has been dealing in the purchase and deposit of gold collectibles from the public and issuing contracts with guaranteed returns with clients, without a valid license from the Commission.
This, the SEC says, is in contravention of “section 109 of Act 929 with consequences under section 2016 (I) of the same Act.”The company was however cleared to continue its “other businesses of assaying, purchasing gold from small-scale miners and export of gold.”
Interestingly the same SEC had a year ago, issued a Public Notice “pursuant to Sections 3(b) (f), 144 (5) and 216 of the Securities Industry Act, 2016 (Act 929)” informing the General Public that “Menzgold Ghana Limited has neither been licensed nor their adverts sanctioned by the Securities and Exchange Commission (SEC) to carry out any activity in the Capital Market as mandated by section 3(c) of the Securities Industry Act, 2016 (Act 929) and therefore MENZGOLD is not a SEC regulated entity”.
The General Public is advised to consult the list of SEC regulated entities on our website: www.sec.gov.gh or call our toll free line on 080010065 or main line 0302768970-2 to confirm the licensing status of any firm that offers them products or services relating to the Capital Market.
The Commission wishes to reiterate its commitment to ensure protection of all investors who patronize the products/services offered by licensed Capital Market operators” the Securities and Exchange Commission said in statement dated September 22, 2017.
The management of Menzgold on Wednesday, tried to defy the SEC directive, saying it was still open for business.
The company, in a statement issued in the wake of the SEC’s directive, said that it found the “leak” of its interactions with the Commission “needless, distasteful and in very bad faith.”
It added that having been engaged in discussions with the SEC in order to find a resolution to the situation, it was disappointed by the release of the details to the public.
SEC said in its statement, dated September 7, that it has been investigating Menzgold since 2017, but paid a working visit to the company on August 23, 2018, where they met with the Commercial Manager, Nana Yaw Offei and an adviser to the company’s CEO, Derek Akubia.
SEC stated that, despite being licensed to only purchase and export gold from licensed sellers, Menzgold, also sells and purchases gold collectibles from the general public through its agent, Brew Marketing.
The Commission, has since requested for “detailed information” on the activities of the company which the lawyers of Menzgold have agreed to provide within 14 days.