Business News of Saturday, 15 September 2018
Embattled gold marketing firm, Menzgold has contracted the services of an international legal firm, Baker and Mckenzie, to help it fight its battle with the Securities and Exchanges Commission (SEC).
In a release Friday, the company said the UK outfit will join forces with its local lawyers, Kwame Akuffo & Co. Unlimited to contest the shutdown of their operations in Ghana.
“The Company will, as a demonstration of good faith and willingness to fully co-operate with the SEC while this matter is resolved, desist in these specific activities outlined in the SEC Communications,” the statement said.
In a letter to the Commission Friday, local counsel for Menzgold, Kwame Boafo Akuffo argued that in the letter of Sept 7, in which SEC ordered the company to shut down, the information required leading to the shutdown was “irrelevant.”
The lawyer said the decision by SEC to shut down the company was unfair and premature.
In a letter dated September 7, SEC said it has thoroughly investigated the activities of Menzgold and has found that the Nana Appiah Mensah-owned firm does not have the license to trade in gold collectibles from the public.
The statement explained that interactions with representatives of Menzgold confirmed to SEC the view that the aspect of Menzgold’s business which involves purchase and deposit of gold collectibles and guaranteed returns is a capital market activity under Act 929 without a valid license issued by SEC which contravenes the law.
The statement added that subsequent requests have been made by SEC to Menzgold’s lawyers to furnish SEC with specific detailed information on the operations of the firm.
The supply of those documents, however, does not clear Menzgold to continue the mentioned aspects of Menzgold’s business.
“That aspect poses a threat to unsuspecting and uninformed investors,” SEC noted.
But newly hired legal firm Baker & McKenzie acknowledging receipt of the Commission’s letter noted it will respond in the next couple of 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,” it concluded.