The Securities and Exchange Commission (SEC) has assured customers of five collapsed fund management firms that their investments are safe.
Last week, SEC revoked the licences of the companies for breaching rules guiding their operations.
The companies include; Georgetown Capital Partners Limited, Equity Capital Limited, Index Analytics Limited, DM Capital limited and Oxygen Advisory limited.
As a result, they can no longer engage in fund management activities in the capital market.
Assuring the public of the safety of their funds in an interview with Citi FM, the Head of Policy and Research at the SEC, Emmanuel Ashong Katai said market operators and the general public are secured to work in the market.
“We are taking serious actions against those who have become persistent flouters of the law. Others too are using the licence for shadow banking purposes and shadow banking is doing banking without the backing of the Bank of Ghana.â€
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Providing more information, Mr Ashong Katai stated that some of the companies do guarantee returns just like the banks.
He, however, pointed out that, investment companies are not required to do that in most cases since they do not have huge reserves which can be easily liquidated.
“Some are even lending money. Instead of investing and managing investments, they will be lending monies to SMEs and other sectors,†he said.
Mr Ashong Katai noted that the SEC has all the list of customers and all funds have been refunded to them so there is no cause for alarm.
SEC revokes licences of 5 investment companies
The Securities and Exchange Commission (SEC) has revoked the licences of five investment companies.
According to the statement from SEC, customers transact business with Georgetown Capital Partners Ltd, Equity Capital Ltd, Index Analytics Ltd, DM Capital Ltd and Oxygen Advisory Ltd at their own risk.
SEC revoked their licences in pursuant to Section 122 of the Securities Industry Act, 2016 (Act 929). The companies are not mandated to carry out any Fund Management activities, the Commission said.
“The Commission hereby assures all investors, market operators and the general public that it is committed to ensuring rigorous enforcement of all the rules for operators in the capital market as spelt out in its core mandate,†the statement added.