Panic withdrawals hit Menzgold
Scores of customers of gold trading company, Menzgold Ghana Limited, are trooping to the premises of the company to withdraw their investments.
This has come about as a result of the Security and Exchange Commission(SEC)’s directive that the company halts with immediate effect, its gold trading activities.
A letter issued September 7, 2018, the Commission said it has found following investigations into Menzgold activities found that firm does not have the license to trade in gold collectibles from the public.
The Commission further explained that it has interacted with representatives of Menzgold and has come to the conclusion that the aspect of Menzgold’s business which involved the purchase and deposit of gold collectibles and guaranteed returns is a capital market activity under Act 929 without a valid license issued by it.
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.
Management of the company appears unperturbed by the directive and has issued a statement assuring its clients that all is well.
The customers are uncertain about that assurance.
Shortly after SEC issued the “stop trading” directive, Joy News editor, Araba Koomson, visited the East Legon premises of the company and reported that many customers want out.
She said some of the customers have between ¢50,000 to ¢100,000 in deposits with the company and have been trying to withdraw them.
Management refused to speak to the reporter and attempted to stop her from reporting at the premises.
At the time of her report, however, the situation seemed to be under control. But by 1 pm when Joy Business' Karen Dodoo visited the premises, about 200 customers were on the premises demanding their deposits.
A customer told her he does not only want matured deposits paid, but he wants the trading agreement terminated.
The gentleman, who said he has been trading with the company for a year now added Menzgold has been prompt in claims payment and has stuck to its side of the agreement.
He, however, fears to lose his investments if he doesn’t withdraw right away.
“Today one of my contracts is ending – about ¢52,000 – and I have another ¢40,000 which I am willing to terminate,” he told Karen.
Although he risks losing 10 percent of that amount - ¢4,000 - for terminating the contract before maturity, he said, “I am willing to let that go.”
Karen said each customer is being made to fill a form with details of their account details.
Staffs, she said, have promised to process and pay claims to each person’s account, assuring that their deposits are safe.