An Accra High Court has dismissed a suit brought by Menzgold challenging the regulatory powers of the Securities and Exchange Commission (SEC), which ordered the company to shut down an illegal operation.
The judge, Justice Akua Sarpomaa Amoah said Menzgold had not exhausted the dispute resolution mechanism with the regulators before rushing to court
The dismissal comes after a court issued a warrant for the arrest of CEO of the company Nana Appiah Mensah, who is accused of defrauding by false pretence and is also suspected to have been involved in money laundering.
In the September 2017 suit, Menzgold asked the court to declare that its “business does not fall within the present legislated scope of the Banks and Specialized Taking Institutions Act
SEC, like the Bank of Ghana, maintained the business did not have a licence, but Menzgold insisted it did not need a licence from SEC or the central bank.
It however gave in to pressure and requested for a meeting with the regulators for an amicable settlement of the issues raised but later opted for a court action following pre-conditions including the provision of documents backing the operations, by the Security And Exchange Commission.
MENZGOLD wanted the court to declare that the directives by the two institutions were arbitrary, capricious and contrary to Article 23 and Article 296 of the 1992 Constitution.
Counsel for SEC filed an application at the court asking that the case be dismissed since the company had failed to conclude its meetings with the two agencies before filling he suit.
Justice Akua Sarpomaa Amoah agreed with the SEC’s objection therefore dismissing the case.
Menzgold has since been closed down and customers are hounding the Chief Executive, Nana Appiah Mensah, NAM 1 for their deposits.