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Home News General News 201911

SEC Must Act To Revive Lost Interest In Investment

29-Nov-2019
/ General News, News
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Director General of SEC, Dr. Daniel Ogbarmey-Tetteh
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For many years, there has been much education by some investment firms as part of their key efforts to encourage more people to invest their money in stocks, mutual funds, fixed incomes, among many other portfolios.

Their argument is that it was better to invest trickles of one’s income over time, while active at work, than to keep the money in savings and earn nothing.

This education drive encouraged many salaried workers and private business people to patronise the services of the numerous investment firms which became aggressive in mobilising funds from people from all walks of life.

The returns they promised became the selling point for them, and in their quest to attract more clients, the companies promised higher interest rates, sometimes above 30 per cent.

Convinced about the fact that the returns on one’s investment might be used as a source of regular extra income for day-to-day living, many devoted a portion of their salaries to build a long-term fortune.

Unfortunately, however, it became evident that most of the investment firms were using short-term funds to engage in long-term investments. Others also used depositors’ funds to engage in businesses that were unrelated to their core business.

In the end, many of them became financially distressed, forcing the industry regulator to revoke the licences of about 53 of them barely a month ago.

In its statement issued to the media, the Security and Exchanges Commission (SEC) explained that the revocation of the licences was to protect the integrity of the securities market and investors.

The regulator, however, is yet to give further details on the next step, although many clients waited patiently to hear how they would be able to access their long-term funds.

The slow pace action of the SEC compelled the association of investment firms in the country to jump into the fray to demand clarity from the industry regulator as to the way forward for investors with locked up capital in the defunct companies.

There are reports to the effect that some customers have been directed to various Consolidated Bank, Ghana (CBG) branches for validation.

However, our checks reveal that many customers are being turned away because the companies whose slips and documents they hold are not part of the process.

This is in spite of the fact that those companies have been listed among the collapsed investment houses.

We think the ordeal customers (many retired) of the 53 collapsed investments firms have been made to go through is avoidable and disturbing, in view of the fact that there isn’t much information to guide them as to what to do next.

Some of these investors are receiving messages from some of the collapsed firms not to avail themselves for the validation process.

What is also hurting is the fact that the long queues, with very few workers attending to the clients, is adding to the pain of the already mentally and emotionally stressed customers.

We wonder why, in this day and age, the industry regulator cannot create an electronic platform which all customers could access to complete the validation process, instead of having to converge on one place for that.

We have closely monitored and witnessed the various unresolved issues around the recent turn of events and would want to prevail on the SEC to get the right things done to ease the stress the people are going through.

The SEC also has the arduous task to revive the lost interest in investment in the country because the ordeal many are experiencing is not only tortuous but also extremely discouraging.

If the adage: “Once bitten, twice shy” is anything to go by, then the regulator need not be told about the consequences of its approach to this sensitive issue.

Source: Daily Graphic

 

 
 

 

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