Picketing customers of collapsed fund management companies arrested

Police have arrested some members of the Coalition of Aggrieved Fund Management Customers picketing at the Ministry of Finance in Accra over their exclusion from the government’s first bailout package.

The picketers, numbering more than 100 stormed the ministry on Tuesday morning to demand their inclusion in phase one of the government’s intervention but were asked to leave the premises.

The weeping protesters, largely from FirstBanc Financial Services and Blackshield Capital Management (formerly Gold Coast Fund Management) have described their exclusion as a deliberate attempt to punished them over differences with their shareholders.

The customers further alleged that the Securities and Exchange Commission misled the public when it accused management of FirstBanc and Blackshield of lack of cooperation and litigation, which formed the basis for their exclusion.

“We have evidence that the SEC had access to the books Blackshield since 2019 as captured in a letter written by an audit firm contracted by the SEC. They are lying to the public and we want the Finance Ministry to authorise them to include us in the bailout package,” Secretary of the aggrieved customer-group Joseph Aryeetey told Business24.

The aggrieved customers have been protesting for release of their funds since November when the SEC revoked the licences of 53 Fund Management Companies due to their failure to return clients’ funds totaling GHS8 billion, and significant breaches of applicable rules that created risks to the country’s financial stability.

Bailout Package

SEC disclosed that the government will announce a bailout package for clients of the defunct FMCs this month (September) but in two phases.

The first part of the exercise will cover clients of the 22 companies currently under official liquidation per Court orders, based on their validated claims. The second phase would cover clients of the remaining companies after the liquidation orders are secured.

According to the SEC, management of Blackshield and Firstbanc have dragged them to Court challenging the revocation of their license, and until a decision is taken, their clients cannot be added in the bailout package.

The two firms have however debunked the assertions by the capital market regulator, citing instances in the banking sector clean-up where customers of defunct banks where included in government’s bailout despite their banks being in court to challenge their dissolution.