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General News of Sunday, 16 September 2018


Closing down Menzgold 'unfair, premature' – Kwame Akuffo

SEC has issued a directive asking Menzgold to halt its gold-trading activities SEC has issued a directive asking Menzgold to halt its gold-trading activities

The legal advisor to Ghana-headquartered gold-trading firm, Menzgold Ghana Limited, Mr. Kwame Akuffo, has raised questions about the fairness of the Securities and Exchange Commission (SEC) in ordering the company to suspend its gold vault marketing operations, insisting its surprising and premature.

SEC and Menzgold are billed to meet on Tuesday to iron out the knotty points over a regulatory stand-off that is threatening to disrupt the latter’s business and put the investment of customers at risk.

The regulator, last month, ordered Menzgold to furnish it with certain documents to ascertain the operations of the gold dealership firm.

Subsequently, SEC issued another directive asking Menzgold to halt its gold-trading activities.

Mr. Akuffo, in reaction, said it appears SEC, having taken the decision to suspend Menzgold’s trading activities, is now asking for the information that should have guided its decision to take that action.

“You will recall that pursuant to your letter dated September 7, 2018, in which you took a decision to shut down our client's business, we wrote to you requesting for a meeting to resolve the issues arising therefrom,” Mr. Akuffo said on Friday, 14 September 2018.

He continued: “It is instructive to note that in paragraph 4 of your letter dated September 7, 2018, you [SEC] stated that subsequent to the visit by the SEC officials, a request for specific detailed information was made and Menzgold has, through its lawyers, agreed to provide the necessary information requested by SEC within fourteen days.

“The provision of the information, however, does not make that aspect of Menzgold's operations any less of an illegality under Act 929 as well as a threat to unsuspecting and uninformed investors.

“Indeed, you were absolutely clear that the said ‘information’ was completely irrelevant for purposes of your decision. It was without receipt of this ‘information’ that you proceeded to order a complete shutdown.

“It is, therefore, a matter of surprise that we are now being told that we are to furnish you with ‘information’ that you did not consider relevant, and above all, were emphatic that the said ‘information’ would have had no bearing on your decision to shut down our client's business.

“It is settled practice that decision makers such as administrative bodies and the courts, which take decisions affecting the rights of others, do not, as a general rule, receive evidence after a decision has been given. On the facts of this case, you have specifically informed us that the ‘information’ does not matter.

“Your letter, therefore, raises fundamental questions as to the fairness of the decision you took on September 7, 2018 as well as whether same wasn’t premature. Under the circumstances, it is difficult for us to reconcile the contents of your letters dated September 7, 2018 and September 13, 2018.”

Mr. Akuffo, however, concluded his protest on an unconditional willingness to attend the Tuesday meeting.