Nigerians, Wake Up! SEC Reveals How To Outsmart Fraudulent Ponzi Traps

The Securities and Exchange Commission (SEC) has urged Nigerians to promptly report any suspected fraudulent investment schemes for thorough investigation and necessary enforcement actions.

In a public notice issued on Thursday, April 24, the Commission warned that Ponzi schemes pose a serious threat to the stability and growth of Nigeria’s capital market.

The SEC expressed concern over the rising prevalence of illicit investment platforms, including those promoting unregistered digital assets. It noted that many fraudulent actors exploit the appeal of cryptocurrency and blockchain-related products to mislead unsuspecting investors with promises of unrealistic and guaranteed returns.

The notice stated:
“The public is strongly advised to remain cautious of investment opportunities that offer unusually high or guaranteed returns with little to no risk.”

It emphasized that such platforms—particularly those dealing in cryptocurrencies, forex trading, or blockchain projects—must be registered and approved by the SEC to operate legally in Nigeria.

Reiterating a key principle, the Commission said, “If it sounds too good to be true, it probably is.”

The SEC urged all prospective investors to conduct due diligence and verify the legitimacy of any investment offer by checking the Commission’s official website: https://sec.gov.ng/cmos.

Additionally, the Commission referenced Section 196 (3) of the Investments and Securities Act, 2025, which criminalizes the promotion or operation of unauthorized or banned investment schemes. Offenders risk a minimum fine of ₦20 million, a prison term of up to 10 years, or both.

The SEC concluded by reaffirming its commitment to prosecuting violators and called on the public to support efforts in protecting Nigeria’s investment ecosystem by reporting any suspected scams or illegal schemes directly to the Commission.