A press release copied to Businesseeekghana.com said these
“two brokerage firms are no longer allowed to execute trades on the market; provide advisory services to clients on capital market issues; and hold in lien or in trust clients’ accounts or their security holdings”.
The decision of the Exchange to expel the membership of LSL and FABL is in view of their violation of the following market rules:
According the regulator, First Atlantic Brokerage Limited was operating without an Authorised Dealing Officer for more than three months, contrary to Rule 6(j) of the GSE Dealing Membership Rules;
Again, the financial status of the company shows a significant deterioration in its operations, resulting in successive negative returns which have eroded shareholders’ funds. Rule 78 of the GSE Dealing Membership Rules requires a member of the Exchange to comply with the prevailing requirements of the Securities and Exchange Commission in respect of capital, liquidity, reports and returns. FABL is in breach of regulation 22 of the SEC Regulations, 2003 (L.I. 1728), which requires a Broker-Dealer to maintain at any given time, minimum liquid fund amounting to at least 20% of the aggregate indebtedness of the Broker-Dealer; and inactivity on the market due to the lack of an ADO to execute trades.
Liberty Securities Limited was also operating without an Authorised Dealing Officer for more than three months, contrary to Rule 6(j) of the GSE Dealing Membership Rules.
The firm also had a low net shareholders’ fund balance and low liquidity position and was also inactivve on the market due to the lack of an ADO to execute trades.
The Exchange has therefore assured all existing clients of LSL and FABL that there are procedures for existing clients registered with both LDMs to transfer their security accounts and security holdings to any LDM of their choice.
“A help desk or a correspondence officer will be communicated by each LDM to respond to clients’ issues”, the statement said.
