The Bank of Ghana has cautioned the general public against saving at the Menzgold investment company.
The Central Bank argues that investment group, MenzGold is not licensed to conduct banking business.
Good reason if you ask me. But…
Let me start with some background information.
Menzgold Company Limited was first known as Menzbanc. They have been doing bullion investment since inception.
Bullion investment is the purchase of gold by individuals which can subsequently be sold for a certain amount of profit.
They changed their name because the Bank of Ghana (BoG) thought the ‘banc’ attached to the name of the company was misleading.
BoG argued that this will cause some members of the general public to perceive that the investment company also performed functions of a bank, hence the name change.
However, the BoG has warned customers to be careful when they do business with the investment company.
This is because reports suggest that Menzgold is taking deposits for non-existent gold and promising outrageous monthly interest rates.
Here we all agree Menzgold is taking deposits and therefore need a license from BoG.
However, Menzgold has denied this allegation.
The Corporate Manager of the company Nana Yaw Offei said that the company does not take deposits because it is not a financial institution.
“Menzgold Ghana Limited is a gold dealing firm, we buy gold and sell gold. All our operations or whatever we do in our outlet is directly linked to the sale and purchase of gold.”
“For that reason, we have acquired the license that gives us the chance to buy gold and sell gold that is by the Minerals Commission of the Republic of Ghana. We are not a micro finance, neither are we a financial institution and so we do not take deposits in any way,” he added.
Why is there a back and forth between a regulatory authority and an investment bank?
If BoG is accusing Menzgold of an illegal act, why not talk to the investment company directly?
Why haven’t the BoG closed down Menzgold if they are transacting a business they haven’t been licensed for?
Does the BoG think the best option is to caution the general public?
A Deputy Governor of the Central Bank Dr Johnson Asiamah said they issued a publication in the newspapers to caution the general public against the company.
If no damage control is done by Menzgold, their business may collapse.
Oh! I nearly forgot to ask, what has happened to the DKM customers who are still chasing their huge investments?
Will Menzgold become the second DKM or God is love fun club?