Good news for clients of defunct FMCs …govt set to roll out bailout package next month

The government will from September this year roll out a bailout package for clients of the 53 defunct Fund Management Companies (FMCs), the Securities and Exchange Commission (SEC) has announced.

The package would be in the form of social intervention similar to what was done for depositors of the failed Special Deposit-taking Institutions (SDIs) and Micro-finance Companies (MFIs).

The first phase would cover clients of the 22 companies currently under official liquidation per court orders, based on the validated clients.

“The official Liquidator will communicate details of the payment process to affected clients starting in September,” the SEC said in a statement issued last Friday.

The second phase would cover clients of the remaining companies after the liquidation orders are secured.

However, customers of four companies including, Blackshield Capital Management Limited, Firstbanc Financial Services Limited, Apex Capital Partners and Ideal Capital Partners Limited, the statement said, would not receive any payments because the companies have filed applications in court to challenge the SEC’s decision to revoke their licences.

It said the SEC has, so far, received 98,820 claims, valued at GH¢10.83 billion, of depositors of 47 FMCs whose licences were revoked.

The Commission, the statement said, has full access to the records of 40 of the companies, partial access to one of the companies, Blackshield Capital Management Limited, formerly Gold Coast Fund Management Limited, and no access to the remaining six.

It said the Commission has completed the validation of the claims filed by clients of the 40 companies, which have made its records available, whilst validation of 82,204 claims, valued at GH₵4.65 billion against Blackshield Capital Management Limited was ongoing.

Firstbanc Financial Services, Kripa Capital, EM Capital, Omega Capital, Nickel Keynesbury and Heritage Securities (Future PIP Management Ltd.), the statement said, were the six companies the SEC did not have their records.

It noted that validation of the 423 claims, valued at GH¢800 million, against Firstbanc Financial Services Limited, was yet to commence because of their initial failure to cooperate with SEC, and the filing of an application for an injunction pending appeal at the High Court, adding that “we are in the process of resolving the issues to get full access to the records of the remaining five firms, which have 489 claims valued at GH¢87 million on them.”

The statement said petitions for the liquidation of the remaining FMCs whose licences were revoked were yet to be decided on by the court.

It would be recalled that the SEC, acting in accordance with Section 122 (2) (b) of the Securities Industry Act 2016, (Act 929) (SIA), revoked the licences of 50 FMCs on November 8 last year, due to their inability to return clients’ funds, totalling GH¢8 billion, and significant breaches of applicable rules that created risks to financial stability.

BY CLAUDE NYARKO ADAMS

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