The Bank of Ghana has indicated that it is working with other agencies to take appropriate action against the gold buying firm Menzgold. 

This was contained in a fresh public notice issued by the Bank of Ghana Tuesday.

Background

The Central Bank in a first notice last year warned the public not to deal with the company. 

In that announcement, the Central Bank noted that under the country’s banking laws, Menzgold was conducting business contrary to some provisions in the Banks and Specialized Deposit-taking institutions Act, 2016 (Act 930). 

It later in the year issued a second notice warning the public again about any dealings with the gold buying firm, adding that “anyone who transacts any of the above-mentioned business with Menzgold Ghana Company Limited, does so at his/her own risk and Bank of Ghana will not be liable to such clients and depositors in the event of loss.” 

It then indicated that it is carrying out the necessary investigations before any action is taken against the company.

Why the latest notice by BoG?

The Central Bank in today’s notice added that, it is forced to issue this announcement because, after several cautions to Menzgold to desist from solicitation, receipt of money and the payment of dividends to its clients the company persists in its deposit-taking activities in breach of section 6 (1) of Banks and Specialize Deposit –Taking Institutions Act 2016 (Act   930). 

The Bank of Ghana in a notice again, reiterated   that MenzGold Ghana is NOT LICENSED and has no authority to engage in the solicitation, receipt of 
The BoG added, “we are in discussion with other relevant regulatory authorities towards the taking of appropriate action against the company”.

In the today’s statement, the Bank of Ghana again maintained that “anyone who transacts any of the above mention business with MenzGold Ghana does so at his or her own risk and Bank of Ghana would not liable in the event of any loss or investments or deposits.”

Rationale behind the warning

Some industry analysts have maintained that these warnings by the Bank of Ghana are to immune the regulator off any legal action, in case the company goes down. 
Sources close to the regulator say they are working with the relevant agencies for that action to be taken soon.  
What are the other regulatory agencies saying?

The Minerals commission and Ministry of Lands and Natural Resources have all told JoyBusiness that the license that Menzgold is currently holding does not allow the firm to take deposits as well as trade in the derivatives or sell products that are likened to derivatives trading. 

All these institutions have told JoyBusiness Menzgold was only given the license to trade and buy gold.  

Menzgold’s response

In a swift response to BoG on twitter, the Chief Executive Officer of Menzgold, Nana Appiah Mensah, said “ TODAY’s JOKE: Bank of Ghana, so now you dey do propaganda…I beg paa Tell Ghanaians exactly what happened with the 5 or so collapsed banks you duly LICENSED & SUPERVISED for years. Please don’t attempt 1 to use our dear Menzgold to cover up… I beg make we think!”