SEC shuts down Kano-based firm for illegal activities

A little-known company based in Kano metropolis has been sealed off by the Securities and Exchange Commission, SEC, for allegedly engaging in “illegal capital market activities”.

The so called company — Dantata Success & Profitable Company — which can best be described as a ponzi scheme, was sealed off by SEC after investigations revealed that it was offering fund management services without first registering and obtaining the necessary regulatory approval from SEC.

Consequently, SEC released a statement informing investors in Nigeria that the company is not licensed to carry out any form of investment in the country. And for violating the Investments and Securities Act (ISA), 2007, the promoters of the company have been arrested and detained by the police, even as all the bank accounts affiliated to it have been frozen.

“They do not have registration with the SEC and the commission has powers, according to Section 13 of ISA 2007, to shut down any company carrying out capital market activities without due registration. Nigerian laws provide that business activities in the country have to be regulated, in this case SEC is supposed to regulate them.”

According to SEC, Dantata Success & Profitable Company uses a tactic that involves soliciting funds from unsuspecting members of the public, whilst enticing them with mouth-watering, monthly returns of between 25% to 50% of their investments.

“The strategy of the company is to solicit for funds from unsuspecting members of the public by enticing them with returns of monthly interest on investment of between 25 per cent to 50 per cent depending on the nature and investment type.”

SEC said it decided to shut down the company’s illegal business operation in order to protect the investing public, some of whom have already fallen victim. The Commission also used the opportunity to advise investors to only deal with registered fund managers and be wary of suspicious investment opportunities.

Information available on the company’s website shows that it claims to be involved in trading, general merchandise, transportation, import, export and general contract.

It also claims to offer various investment options, starting with the minimum sum of N50,000 to the maximum sum of N5,000,000. Maturation periods range from a minimum of 6 months to a maximum of one year.