SEC urges AMCs/FMs to meet clients’ financial obligations

The Securities and Exchange Commission says it is worried that certain investors are unable to access their matured investments from some of its licenced Asset Management Companies (AMCs) or Fund Managers (FMs), due to some liquidity challenges.

It has therefore instructed all licenced Asset Management Companies (AMCs) or Fund Managers (FMs) to put in place mechanisms to meet their obligations as they fall due to their clients, consistent with the terms and conditions of the investment contracts signed with them.

In a public notice issued in Accra last week, it advised dissatisfied customers of those AMCs/FMs to lodge written complaints with the Commission.

The Commission wishes to assure the investing public that it is committed to regulating and promoting the growth and development of an efficient, fair and transparent securities market, in which both investors and the integrity of the market are protected.

‘’We are aware of some level of anxiety among a section of investors because of the recent reforms taking place within the financial system. We wish to reiterate that the objective is to produce sound market operators, stronger financial intermediation and financial inclusion, and ultimately a more robust financial sector.’.

The Commission is engaging with stakeholders on efforts to improve liquidity in the industry. The Commission has and continues to introduce regulatory measures to help ensure a stable, efficient, transparent and fair marketplace where investors’ funds are protected. Some of the measures include:

  • Holding AMCs/FMs accountable for honoring their obligations to their clients
  • The introduction and enforcement of corporate governance guidelines for operators in the industry, including AMCs/FMs
  • Higher minimum capital/liquidity requirements for AMCs/FMs and other operators
  • Stringent licencing requirements
  • Investment guidelines including restrictions on related party investments/ guaranteed investments
  • Streamlining the Commission’s internal processes including through automation of processes to promote efficiency.

Once again, we wish to reiterate that there is no need for panic-withdrawals, as the Commission is committed to ensuring a sound, efficient and robust market where investors’ funds are protected. There are well-run and sound licenced AMCs/FMs, and investors can confirm by asking a few questions regarding their governance practices, their track-record, staff turnover, any unresolved complaints and/or regulatory breaches, the statement said.

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