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The Securities and Exchange Commission (SEC) has assured all concerned that no customer with validated claims from the government rescue plan will be excluded from the government rescue plan.
This comes after Blacksheild Fund Managing in a statement alleged that the Commission is working to exclude its clients from the planned claims settlement.
However, in a rebuttal, the SEC has described these claims as unfounded and unsubstantiated.
Background
Blackshield alleged that the SEC issued a public notice in 2017 stating that Blackshield’s structural financing product would continue within a 6-month period from the date of the directive.
In addition, they alleged that this directive “triggered unprecedented lawsuits” from Blackshield clients and other fund managers seeking redemption, leading to a backlog of payments.
The SEC has described this statement as “inaccurate” as the directive referenced in its complaint was issued in 2014 and not 2017 as stated in Blackshield’s statement.
“In June 2018, the SEC held a meeting with the Executive Management
and members of the Board of our market operators and reminded them that the practice of offering guaranteed returns to their clients was illegal and that the SEC was going to enforce an earlier directive issued in 2014. ″
The Commission added that it asked fund managers to cancel any charges that fund managers, including Blackshield, may have with their clients, offering concessions “to fund managers who were unable to undo their positions due to defaults. of the counterparties “to inform the SEC of its inability to do so at the end of December 2018.
In addition to this, the fund managers were also required to submit a plan for the SEC’s consideration.
The SEC notes that from 2018 to 2019, “a total of 1,161 complaints from Blackshield customers (representing 52% of total complaints) were received by the Commission valued at GHS782 million.”
Unfortunately, even after the SEC held complaint hearings to obtain payment plans for some of the investors, “Blackshield did not comply with most of the payment plans.”
In addition to this, the SEC was accused by Blackshield of refusing to “grant an alternative product.” This, according to the Commission, is “another falsehood”.
According to their statement, the SEC heard Blackshield in the discussions, giving the fund managers an opportunity to present a concept that Blackshield had developed, after which they were asked to make a formal submission to the SEC for approval.
However, it was not until a series of follow-ups by the SEC that Blackshield submitted the relevant documents supporting the Cardinal Asset Master Offering of Trust and bond listing for approval in June 2019, 4 months after filing. .
Following the review, Blackshield had to address some issues raised in their offer, however, they did not reply to the Commission.
“After a thorough review of the application, with Investor Protection as
A key consideration of a bond issue, the SEC wrote to Blackshield on July 9, 2019 with problems to repair, but they did not respond to the Commission, ”the statement said.
Some of the issues identified with the application that Blackshield was asked to address was the omission of basic documents including, but not limited to, the following: audited statement of affairs, legal due diligence report, board and shareholder resolutions and asset valuation reports “.
Settlement
On the issue of liquidation, Blackshield’s petition, according to the SEC’s statement, is currently pending due to actions taken by the fund managers following the revocation of his license.
“Blackshield first appealed to the SEC on November 11, 2019, three (3)
days after the revocation, before formally appealing to the Administrative Hearings Committee (AHC) on November 14, 2019. Consequently, the liquidation petition had to be suspended until the AHC’s determination ”.
Their appeal was later dismissed by AHC and the same was communicated to Blackshield on June 8, 2020. Blackshield then proceeded to file an application in court “alleging that they were not given a fair hearing at the AHC.”
According to the SEC, it should be noted that although the application was filed on June 15, 2020, the hearing date was scheduled for July 28, 2020.
Client validation Data
Regarding validation, the regulatory body maintains that “the validation of the claims filed against Blackshield is also partially done by the limited access to its records.”
According to his statement, the Commission did not have full access to all customer information records necessary to initiate payments.
“The data provided by Blackshield to our agent for the forensic audit and the SF (the product was in excel format but our agent did not see any evidence to support the values in the excel sheets”).
“After persistent requests for access to all of Blackshield’s records were unsuccessful,” the SEC was forced to enlist the help of a law enforcement agency that was able to recover the server on which all the information was kept. the client’s.
The data obtained will help your agents to process the validation of claims filed against Blackshield.
The SEC noted that without proper validation of the claims, no government bailout would be possible.
In conclusion, the Commission assured “all affected clients that the Government’s rescue package is all-inclusive, provided that the claims have been validated and the settlement orders have been obtained.”
He reiterated the fact that there is no plan to exclude any group of clients, adding that the rollout of the government bailout will be done in phases.
