SEC bailout package inadequate – Industry operators want more from government

The Ghana Securities Industry Association (GSIA) said it has noted the decision by the Securities and Exchange Commission (SEC) to begin paying clients of collapsed fund management companies their locked up funds before the end of the year.

It said “The SEC’s release is no doubt timely given the severe distress investors who invested their cash through these firms have been under more so when there has been a lot of uncertainty regarding payment of their investments as promised by the government.

Reacting to the update on the release of funds to the clients of affected collapsed investment and fund management companies in a written response to the Graphic Business, the association said: “To date, less than Ghc90 million out of Ghc1.58 billion due these investors has been paid in cash. This represents less than six per cent of the total amount due. However, we are yet to realise the fulfilment of a promise by Government to pay up to 20 per cent more in cash, leaving 80 per cent in bonds.

A commitment to pay clients of firms whose licenses have been revoked while customers of operating firms are still waiting for cash pay-outs sends the wrong signals to the industry; the pay-off for having a license revoked may be more than that for keeping an investment firm in operation.

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