There is fire in the mineral regulatory agencies. No more pretensions, the combatants have taken battle positions. The Ghana’s Gold Buying and Selling giant, MENZGOLD, has found its musket in attacking position, take on spirited Security and Exchange Commission (SEC) in a legal brawl to uphold its license to buy, sell and Export Gold.
In a bizarre legal battle, the gold dealership giant, MENZGOLD has unleashed Baker & McKenzie LLP, an international leading law firm based in the United Kingdom allied with a fierce and ferocious Counsel; Kwame Akuffo and Co. Unlimited on Security and Exchange Commission (SEC).
The conflict revolves around a directive from the Securities and Exchange Commission (SEC) forcing the gold trading firm to shut-down their trading operations with abrupt effect for contravening the Securities Industry Act, 2016 (Act 929).
Menzgold was further advised to halt advertising of their investment business and desist from generating new contracts with depositors.
‘Investigations conducted by the regulator found that Menzgold’s business which involves the purchase/deposit of gold from the public and contracts issued with guaranteed returns with clients is a capital market activity which cannot be conducted without a valid license issued by the SEC’, a letter addressed to the Menzgold CEO, (Nana Appiah Mensah) by the SEC and leaked to the media, read.
Even though, an aspect of the SEC’s directive does not affect Menzgold’s other business dealings such as assaying, purchasing gold from small-scale miners and export of gold which is regulated by the Minerals Commission, the company is seem upset with SEC for the seemingly mortification visited on them.
In the early stages, the tone was still friendly enough. In a press statement, Nana Appiah Mensah, the CEO of MENZGOLD, pledged to submit itself to the full rigors of the laws of the land as abiding citizens.”, assured its customers of continued existence and service quality, sustainable returns, but insisted the days of such niceties are now over.
” These needless leaks believed to be coming from the Securities and Exchange Commission or the Bank of Ghana, is in a very bad faith and distasteful; as it defeats our confidence in the bodies and an upfront to cooperation of which we totally condemn’’. The statement said.
Assuring their numerous customers, “As a law-abiding organization, we have referred the matter to our lawyers and rest assured, the right action shall be taken’’.
True to their words, Menzgold has contracted Baker and McKenzie LLP to engage SEC and or Bank of Ghana (BoG) on its behalf.
Baker & McKenzie in a letter dated 13 September 2018 and signed by Michael Doran, a partner, addressed to the Deputy Chief Executive Officer of SEC, said, we refer to:
(a) your communication dated 3 September 2018 (“Trading in Securities without license by Menzgold Ghana Company limited”) addressed to the Minerals Commission.
(b) your communication dated 7 September 2018 [“Notice to Suspend Trading Without License”) addressed to the Minerals Commission. (together, the “SEC Communications”).
We have been engaged by Menzgold Ghana Limited (“Menzgold” or the “Company” to represent it in this matter.
- The Company acknowledges receipt of the SEC Communications and will respond in the next several days setting out why it strongly believes that it is fully in compliance with all aspects of the laws of Ghana including, without limitation, the Securities Industry Act 2016.
- The Company will, as a demonstration of good faith and willingness to fully cooperate
with the SEC while this matter is resolved, desist in these specific activities outlined in the SEC Communications.
- This voluntary and temporary cessation of these alleged activities is without prejudice to the Company’s legal position nor any acknowledgement of wrongdoing in any way. It is a simple gesture of good faith to give all pause for consideration of the technical legal issues and to allow its lawyers to fully engage with the SEC on this matter.
One needs not be a rocket scientist, a sorcerer or prophet to say that, the days ahead promises to present Ghana a boisterous legal showdown, as the laws of Ghana are put to test to present Ghana a fine judicial precedent.