MenzGold Ghana Limited which has recently courted controversy over its operations was licensed solely to buy gold in Ghana and export to other countries.
The company, which was given its license as MenzBanc Ghana Limited in the agreement document sighted by citinewsroom.com consented to buying the precious mineral from registered small-scale miners and subsequently exporting.
MenzGold has recently come under the spotlight over its operations which the Bank of Ghana has cautioned the public against.
The Bank of Ghana which was to join the Minerals Commission to work together with the company to regulate its purchasing and export of gold last week threatened to take punitive measures against Menzgold Ghana Company Limited.
According to the Bank of Ghana (BoG) Menzgold, which is known as a precious minerals trading company, is carrying out unlawful transactions by taking deposits.
In a public notice issued by the BoG, it said the company has no authority to engage in what it says are the “solicitation, receipt of money or investment and the payment of dividends or returns to its clients.”
The central bank maintained that MenzGold is in breach of section 6(1) of the Banks and Specialised Deposit-Taking Institutions Act, 2016 (Act 930).
BoG further said in spite of several warnings to the company, Menzgold continues to engage in the illegality; hinting that discussions were already underway with regulatory authorities to enforce the appropriate action on the company.
The central bank, however cautioned the general public against transacting business with MenzGold.
But MenzGold has denied flouting the BoG’s regulations, describing its statement as unfortunate.
“Menzgold finds it unfortunate and disparaging that the Bank of Ghana with whom we have had a number of engagements over the years and taken them through our business operations would still issue such a statement”, the MenzGold’s statement said.
But the document sighted by citinewsroom.com showed that although MenzGold was also required to make some supplies of the product to local refineries, MenzGold was primarily to sell the gold outside the country and repatriate majority of the proceeds.
The then Lands and Natural Resources Minister, Nii Osah Mills, who signed the agreement on behalf of the government on 22nd August 2016, indicated that “The Company is hereby authorized to purchase gold locally from any person holding a small scale mining license (“small-scale miner”) at the Company’s registered offices in Ghana to export same in accordance with the terms of this Agreement.
Conditions in the agreement that MenzGold was to follow included repatriating at least 80% of the proceeds from its sale of the gold.
It was also expected make a monthly payment of 0.05% on all of its gold purchases to the Minerals Commission to be used in ensuring sustainable development of the small-scale mining industry while being given the authority to appoint Ghanaian gold buying agents.