The Securities and Exchange Commission (SEC) has shut down Nyak-City Hostels Limited for offering an unlicensed investment product to the public, in a joint enforcement operation with the Economic and Organised Crime Office (EOCO) that signals a tougher stance against entities operating outside Ghana’s capital market regulatory framework.
The company, incorporated in 2025 by the Registrar of Companies, operated an investment product known as “Treasury Hostel Investment,” which it marketed as “a better alternative to a treasury bond” and promised investors guaranteed lifetime returns from investments in hostels over a period of 60 years — without the required licence from the SEC.
The enforcement exercise was carried out on Monday, September 28, 2026, in collaboration with EOCO, as the regulator steps up action against entities operating outside Ghana’s investment regulatory framework. The involvement of EOCO signals a wider enforcement approach, with the SEC working with law enforcement agencies to investigate activities involving suspected breaches of Ghana’s financial and investment laws.
A 60-Year Promise Without a Licence
Speaking to the media during the shutdown, Deputy Director-General of the SEC, Mensah Thompson, said the Commission remained committed to sanitising the investment sector and protecting the renewed confidence in Ghana’s financial industry.
“We take action. We can’t wait for the risk to happen for people to lose money before we take action,” Thompson said. “We are saying that the SEC is no longer going to sit back anymore.”
He said the Commission had received intelligence on the company’s activities and moved to shut down the facility before investors could potentially suffer losses.
“Once we receive intel, we move straight, shut the place down. If we need to arrest, we arrest. If we need to prosecute, we prosecute.”
Thompson expressed particular concern about businesses hiding behind real estate to offer investment services to the public without the requisite licence. “These are the people who siphon away confidence from our market, and we need to work together so that we can protect the confidence that is gradually coming back into our financial sector and our economy.”
Background: A Planned 1,000-Bed Hostel at UCC
Nyak-City came under the SEC’s radar over activities linked to the mobilisation of funds from the public for its hostel development project. The company had been seeking financial support for a planned 1,000-bed hostel facility at the University of Cape Coast (UCC) Agona Nyakrom Campus.
In August 2025, the company’s Chief Executive Officer, Yawson Otoo, announced that architectural designs for the project had been completed and appealed to individuals, families, private companies and corporate organisations to support the development. The company had also outlined a wider five-year plan to develop up to 10,000 beds, starting with the 1,000-bed facility at the UCC campus, as part of efforts to provide accommodation for students and support economic activity around the area.
The SEC’s action relates to the regulatory requirement for companies that offer investment products or mobilise investment funds from the public to obtain the appropriate approval from the Commission. The shutdown highlights the distinction between ordinary fundraising for a business project and activities that amount to offering an investment product to the public — such activities fall within the regulatory responsibilities of the SEC and require the appropriate licence.
The Regulatory Framework
The SEC is mandated under the Securities Industry Act, 2016 (Act 929), as amended, to regulate and promote the growth and development of an efficient, fair, and transparent securities market in which investors and the integrity of the market are protected. Under Section 109 of Act 929, a person shall not operate as a market operator, broker, dealer, investment adviser, fund manager, or in any other capital market activity without a valid licence issued by the SEC. Section 206 of the Act provides that a person who contravenes the Act commits an offence and is liable to the prescribed administrative and criminal sanctions.
Further, under Section 294(1)(b) of the Companies Act, 2019 (Act 992), it is unlawful to make public invitations to invest in a company’s securities without complying with statutory requirements. Any person who engages in such unauthorised capital market activities is liable to administrative and criminal sanctions under the laws of Ghana.
Thompson stressed that investment products offered to the public must be licensed, vetted and scrutinised by the regulator to ensure that investors are adequately protected. He said licensed investment products also provide regulatory and resolution mechanisms that can be activated if something goes wrong.
“People can invest safely in regularised products, licensed products that have been vetted, scrutinised and approved by the regulator to be offered to the public, so that tomorrow, if something goes wrong, there are resolution mechanisms that we can take them through.”
The SEC confirmed it had invited representatives of Nyak-City Hostels Limited to its offices to begin discussions on the matter. Thompson explained that the Commission had, for now, taken what he described as a lenient action by shutting down the facility rather than making arrests, but indicated that further enforcement action, including possible arrests and prosecution, could follow if necessary.
A Broader Crackdown on Unlicensed Investment Schemes
The shutdown of Nyak-City Hostels is the latest in a series of enforcement actions by the SEC as it intensifies efforts to protect investors amid a resurgence of confidence in Ghana’s financial sector following the 2022 domestic debt crisis.
In February 2026, the SEC issued a public warning against Mekanism Marketing Ltd, an unlicensed online investment scheme that promised fixed daily returns tied to vague tasks labelled “Job 1” through “Job 10.” The Commission described the advertised returns as unrealistic and unsustainable, noting that the structure bore the hallmarks of a fraudulent scheme. The SEC stated unequivocally that Mekanism Marketing Ltd was “NOT licensed, authorised, or approved to operate in Ghana’s capital market.”
In July 2026, the SEC flagged 23 online entities found to be operating without the required licences, cautioning Ghanaians against investing with them. The Commission disclosed it was collaborating with law enforcement agencies to investigate the operators and take enforcement action. That same month, the SEC engaged the Cyber Security Authority over reports that thousands of Ghanaians may have lost millions of cedis in an alleged investment scam.
The regulator has also turned its attention to unlicensed investment commentary on social media. In April 2026, Thompson warned that offering investment advice without a licence contravenes the Securities Industry Act, stating: “It is an offense to offer investment advice or run commentary that has the potential to sway the behaviour of investors without the requisite license.” The SEC indicated it was collaborating with the Cyber Security Authority to identify and take action against individuals and platforms engaged in unauthorised investment advisory activities across TikTok, Facebook, X and Instagram.
In September 2026, the Bank of Ghana and the SEC issued a joint warning against a cryptocurrency investment platform allegedly using a manipulated video of President John Dramani Mahama to promote its scheme on social media. The regulators cited Section 4(i) of Act 930, which provides that only a body corporate licensed by the Bank of Ghana may carry out deposit-taking business, and warned that anyone found operating the platform would be required to refund all money collected from the public.
Protecting Hard-Won Confidence
The SEC’s aggressive enforcement posture comes at a delicate moment for Ghana’s financial sector. The country is emerging from a severe economic crisis that saw it default on its external debt in December 2022, undergo a comprehensive domestic debt restructuring, and endure inflation that peaked at 54.1%. With inflation now at 5%, the cedi having stabilised, and the stock market booming, regulators are keen to prevent a new wave of fraudulent schemes from undermining the recovery.
“These are the people who siphon away confidence from our market, and we need to work together so that we can protect the confidence that is gradually coming back into our financial sector and our economy,” Thompson said.
The SEC has urged the general public to verify the licensing status of any individual or entity offering investment products or services before committing funds. Members of the public may contact the SEC through its toll-free line (0800 100065), main line (0302 768970–2), email (info@sec.gov.gh), or website (www.sec.gov.gh).
The Commission says it will continue to take action against unlicensed investment operators as part of efforts to protect investors and safeguard confidence in Ghana’s financial sector.
