SEC Charges African Gold Acquisition Corp. for Internal Controls Violations Leading to Misappropriation of Funds
The Securities and Exchange Commission (SEC) announced settled charges against African Gold Acquisition Corp., a publicly-traded special purpose acquisition company (SPAC), for violations of internal controls, reporting, and recordkeeping. The SEC's Order revealed that the company had given its former Chief Financial Officer (CFO) control over nearly all aspects of its operating bank account and financial reporting process with not enough oversight, allowing him to misappropriate around $1.2 million from the company's operating bank account and alter the company’s bank statement to conceal his fraud. As a result of these findings, African Gold was charged by the SEC for failing to discover the misappropriation within the allotted timeframe and failing to comply with basic internal control requirements. Cooper J. Morgenthau, African Gold Acquisition Corp.'s former CFO, has also been charged by the SEC in relation to this case. The investigation was conducted by Anne Hancock, David D'Addio, Ryan Murphy, and Amy Gwiazda of the SEC's Boston Regional Office, with the assistance of Alex Lefferts and Brian Shute of the Enforcement Division's Office of Investigative & Market Analytics.