The Securities and Exchange Commission (SEC) has announced that the revocation of licenses of some 53 Fund Management Companies will not affect valid licenses of mutual funds that were managed by the collapsed companies.
By this, SEC has directed the managers of these mutual funds to ensure that the schemes continue to run in the best interest of shareholders by appointing new fund managers to oversee the investment.
In a statement, SEC clarified that the 13 mutual funds and five-unit trusts managed by the companies are still intact.
“Some of the affected FMCs were managers of Collective Investment Schemes (CIS) in the form of Mutual Funds or Unit Trusts. Please note that the revocation of the licences of the Fund Managers neither affects the valid licences of, nor terminates the Mutual Funds and Unit Trusts that they used to manage. Shareholders and unit holders of these Mutual Funds and Unit Trusts are therefore not included in the ongoing submission of claims. Total number of CIS affected is 18; made up of 13 mutual funds and 5 unit trusts.”
It added that such investors shall be advised by the companies’ Boards and Trustees.
“In accordance with section 88 (6) of the Securities Industry Act, 2019 (Act 929), Boards of Directors (for Mutual Funds) and Trustees (for Unit Trusts) of affected CIS are to ensure that the schemes continue to run in the best interest of shareholders/unitholders by appointing new fund managers to operate the CIS. Investors of affected CIS shall be advised by their respective Boards and Trustees”, the statement concluded.
List of affected collective investment schemes
The SEC revoked the licenses in line with Section 122 (2) (b) of the Securities Industry Act, 2019 (Act 929).
Validation
Following the revocation of the licenses of 53 Fund Management Companies, SEC designated branches of Consolidated Bank of Ghana Limited (CBG) to receive the claims from clients who have their funds locked up at the affected companies.
The SEC said it has authorized the said branches serving as agents “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.”
Evidence of investment claims such as investment certificates, account statements, receipts among other relevant documentation for validation is required.