Ace Ankomah shreds Menzgold with three arguments

Ace Ankomah shreds Menzgold with three arguments

Private legal practitioner, Ace Ankomah, wants managers of Menzgold, a gold dealership whose operations have been a subject of debate recently, to be mindful of the law when defending their activities as above board.

According to him, the indigenous company’s business module breaks at least three regulations – the Company’s Act, the Minerals and Mining Act and the Securities Industry Act.

“Let’s get it right. It started as Menzbank, with a ‘K’, Bank of Ghana stepped in; they changed their name to Menzbanc, with a ‘C’; Bank of Ghana stepped in; they changed their name to Menzgold, with metal. Let’s stop this molly cuddling these issues. We can see the thing. If it walks like a duck, quacks like a duck, sleeps like a duck, it is a duck. Under the company’s act alone, as a private company, you cannot take deposits – whether interest-bearing or fixed. The law says that clearly,” the renowned legal practitioner said on MultiTV/Joy FM’s news analysis programme Newsfile, Saturday.

Menzgold’s business operation has come under scrutiny for what many believe is a flagrant abuse of the laws regulating deposit-taking firms.

The company essentially offers an investor the opportunity to make huge returns – some 7% every month – on whatever has been invested. Menzgold converts the cash an investor puts into the scheme into equivalent gold tokens. These tokens are then deposited with the dealership for the monthly interests to kick in.

Touted by some as an innovative business module needing support, the company claims it trades the gold the investor has willingly agreed to deposit with them on the international market. Many doubt this claim on grounds that the returns on trading gold on the international market does not fetch enough returns to allow Menzgold to give 7%  a month as returns to its investors in Ghana.

The Bank of Ghana and the Precious Minerals Marketing Company (PMMC) have faulted the company’s activities, while a section of the public think the business module resembles a Ponzi Scheme.

Menzgold has fought back criticisms every step of the way. Chief Executive Officer of the gold dealership, Nana Appiah Mensah, took a swipe at the Bank of Ghana for describing the business operation as a deposit-taking venture.

The PMMC also said the licence granted Menzgold does not allow it to buy gold from just anybody but small-scale miners for export.

Related: Menzgold not licenced to sell, trade gold locally

Controversy settled?

However, speaking on the matter Saturday on MultiTV/Joy FM’s Newsfile, Ace Ankomah said it is clear by three simple laws that Menzgold, registered as a private company, has been overstepping its operational boundaries for at least two years now.

 “A private company cannot invite the public to deposit monies. Period. It is so critical that it must be stated under Section 9 in [the] regulations [of] a private company. So if you are not a public company, you cannot invite the public to bring deposits to you. Period. The exemption, quasi-public, is if you get a banking or a specialised deposit licence.

He then referred to the Minerals and Mining Act of 1994 (Act 475), which among other things, regulates mining of precious minerals in Ghana.

“Under the Minerals and Mining Act, you cannot deal in, let’s say gold, except you have a licence. It’s an offence. You will go to jail. And if you get a licence, you cannot operate outside the licence,” he said.

This argument is similar to PMMC’s.

Contrary to suggestions by some that Menzgold’s operation occupies a grey area because the law does not adequately regulate the commodities market, Ace Ankomah said there is such a law –  the Securities Industry Act, 2016.

“The Securities Industry Act defines a security to include derivatives. It defines derivatives as when you are using commodities. If anybody says the commodities market in Ghana is unregulated…with due respect the law provides for it,” he said.

Watch the segment of Newsfile where the Menzgold issue was discussed.


Source link

Like it? Share with your friends!


What's Your Reaction?

eiii eiii
hate hate
confused confused
fail fail
fun fun
geeky geeky
love love
lol lol
win win


Your email address will not be published. Required fields are marked *

You may also like

More From: Business


Choose A Format
Personality quiz
Series of questions that intends to reveal something about the personality
Trivia quiz
Series of questions with right and wrong answers that intends to check knowledge
Voting to make decisions or determine opinions
Formatted Text with Embeds and Visuals
The Classic Internet Listicles
The Classic Internet Countdowns
Open List
Submit your own item and vote up for the best submission
Ranked List
Upvote or downvote to decide the best list item
Upload your own images to make custom memes
Youtube, Vimeo or Vine Embeds
Soundcloud or Mixcloud Embeds
Photo or GIF
GIF format