The Securities and Exchange Commission has issued a new warning to the Nigerian investing public, advising caution against fraudulent investment schemes such as Ponzi schemes and unregistered digital asset platforms.
In its public notice on Thursday, the SEC highlighted the severe risks posed by illegal investment activities, including Ponzi schemes and unregistered digital asset platforms.
The Commission emphasized the importance of regulatory compliance in maintaining the stability of Nigeria’s capital markets and protecting investors from financial harm.
The SEC warned that fraudulent entities and individuals are still exploiting unsuspecting investors by promoting deceptive investment opportunities that promise high guaranteed returns with little or no risk.
“These include unregistered platforms offering cryptocurrency investments, forex trading, or blockchain-based schemes, which operate outside regulatory frameworks and lack approval from the SEC,” the Commission stated.
The notice reinforced a critical warning: “If it sounds too good to be true, it likely is.”
To protect investors, the SEC advised potential stakeholders to conduct thorough due diligence and verify the registration status of financial firms through the official SEC database: https://sec.gov.ng/cmos.
Additionally, Section 196(3) of the Investments and Securities Act, 2025 criminalizes the promotion and operation of unregistered investment schemes, with violators facing severe penalties.
“This violation is punishable upon conviction by a fine of not less than N20 million or a prison term of 10 years, or both,” the Commission warned.
The SEC reaffirmed its commitment to identifying and prosecuting offenders involved in illegal financial practices.
“We encourage the public to partner with the SEC to safeguard the integrity of Nigeria’s investment environment by promptly reporting suspected illegal investment schemes for investigation and necessary enforcement actions,” the statement added.
The Commission’s renewed crackdown on fraudulent investment platforms highlights the crucial need for investor awareness, strong regulatory enforcement, and public cooperation.
These efforts are key to ensuring financial security and fostering trust in Nigeria’s capital markets.
The recent collapse of the digital asset trading platform CBEX has sparked urgent calls for stricter government regulation and enforcement.
CBEX, which operated without an official social media presence, marketed itself as a high-yield investment platform but ultimately left users in financial distress.
The platform’s sudden crash, which resulted in investors being unable to access their funds, has caused losses exceeding N2.4 billion and highlighted significant gaps in Nigeria’s regulatory framework for digital investments.
