Customers of fund management firms demand prompt payment of locked-up cash

Customers of the 53 collapsed fund management companies are calling on the government to ensure an expeditious payment of their locked-up funds.

The customers said their inability to access the monies is making life difficult for them.

Some of the customers, who are aged people lamented their inability to foot medical bills among other necessary expenditures due to the situation.

They are therefore urging the government to ensure that their monies are paid before March 24, 2020.

They expressed concerns that they seem to have been sidelined in the process of paying customers whose funds have been locked up in various collapsed financial institutions.

Addressing the media in Accra, spokesperson for the Coalition of the Aggrieved Customers of 53 fund management companies, Charles Nyame said the group will embark on a demonstration if the government fails to pay their locked-up investments.

“If this Nana Addo-led administration really cares about the suffering of the customers, then he should put in measures to fix this situation before March 24, 2020, which day we will hold a mammoth demonstration on the streets of Accra against his government,” he said.

Some pensioners who form part of the group lamented the severe hardship they have been subjected to following the collapse of the fund management companies.

“I am now a serial beggar which is very shameful. I must get something to keep me going. My medical fees,” one said.

Another pensioner who spoke to Citi News said, “I am a pensioner and I’m a widow. Sometimes even if you are sick and you need money to go to the hospital, it is difficult. I need my money to take care of myself.”

Validation process

In November 2019, the customers were asked to go through a validation process to ensure that they are paid their monies but the customers expressed dissatisfaction about the slow pace of the process.

The collapse of Fund Management Companies

The Securities and Exchange Commission (SEC) in November 2019 revoked the licenses of 53 Fund Management Companies.

SEC, in a statement explained that the revocation follows the companies’ failure to “return client funds which remain locked up and in a number of cases, have even folded up their operations.”

The action was taken pursuant to Section 122 (2) (b) of the Securities Industry Act, 2019 (Act 929) which authorizes SEC to revoke the license of a market operator under some circumstances.

Included in the list of the defunct companies was Black Shield Fund Management, a subsidiary of Groupe Nduom.

SEC selected branches of Consolidated Bank of Ghana Limited (CBG) to receive claims from clients who have their funds locked up at the affected companies.

The banks were tasked to accept relevant documents for the validation of the investment claims.

According to SEC, the said branches serving as agents were authorized “to ascertain and validate details of investors and their investments with these institutions at the time of the revocation to facilitate the administration of the Government pay-out of a capped amount to affected investors.”

Source: Citi