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UCCs’ GH¢9m investment locked up in collapsed First Banc, Gold Coast Fund Mgt – A-G report.

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UCCs’ GH¢9m investment locked up in collapsed First Banc, Gold Coast Fund Mgt – A-G report. 46

 

 

The University of Cape Coast (UCC) has GH¢9, 123, 532.57 locked up with First Banc and Gold Coast Fund Management whose licenses were revoked by the Securities and Exchange Commission (SEC) in 2019.

This revelation was contained in the Auditor-General’s report on the public accounts of Ghana, public boards, corporations, and other statutory institutions for the period ended 31 December 2021.

The revocation of the licenses of the companies in 2019 according to SEC was necessary as the “companies had largely failed to return client funds which remain locked up and in a number of cases, they had even folded up their operations.”

These actions were taken pursuant to Section 122 (2) (b) of the Securities Industry Act, 2016 (Act 929 or “the Act”) which authorizes the Securities and Exchange Commission to revoke the license of a market operator under certain conditions.

SEC explained that the firms “have failed to perform their functions efficiently, honestly and fairly and in some cases are in continuing breach of the requirements under relevant securities laws, rules or conditions, despite opportunities provided to them by the SEC within a reasonable period of time to resolve all regulatory breaches”.

SEC said it “has concluded after extensive engagement with these institutions that their continued existence in the light of their conduct poses severe risks to the stability of the capital market and to the interests of investors”.

The Auditor-General has recommended that the management of UCC pursue recovery of their investments from the receivers of First Banc and Gold Coast Fund Management through the Security and Exchange Commission.

The report also noted that 14 projects valued at GHS¢78,928,271.14 fully funded from the Internally Generated Fund have been delayed for periods ranging between two and eight years. Seven out of the projects were between the completion stages of 87% and 99% and recommended that the Management of the University should ensure early completion of the projects to save the projects from further deterioration.

The University also did not have legal title to five of its properties valued at GHS8,580,000 belonging to the School of Medical Sciences although the properties are occupied by the School of Medical Sciences and form part of the University assets in 2019 financial statements.

“We recommended management take immediate steps to secure title deeds for the affected properties in order to avoid losses that may arise as a result of disputes,” the report counseled.

The report further noted that although management of the University did provide the tenancy agreement between the UCC and Ghana Hostels Limited for the occupancy of 5.009 acres of the University’s land the management must provide any Memorandum of Understanding or rent Agreement between the University and Ghana Hostel Limited for audit review.