The Securities and Exchange Commission (SEC) has expressed serious concern over the resurgence of Ponzi schemes and illegal fund managers in the country’s financial sector. This is as more members of the investing public continue to fall prey to the activities of these illegal fund managers.
This was made known by the Director-General of SEC, Mr Lamido Yuguda, at an enlightenment workshop with the staff of the Federal Ministry of Finance, Budget and National Planning on Wednesday in Abuja.
According to NAN, Yuguda said the unlawful schemes had continued to enjoy massive patronage of the populace and remained a source of concern for regulators in the financial sector.
What the Director-General of SEC is saying
Yuguda said the commission is ready to continue to apply measures and seek the cooperation of relevant stakeholders towards preventing the activities of these Ponzi schemes.
He regretted that the reputation of the financial markets and investors’ confidence, among others, have been negatively affected by the upsurge of these illegal schemes.
The SEC boss said, “SEC firmly believes that the country’s capital market can attain its potential if market operators and participants contribute their respective quotas to the growth. SEC is committed to always ensuring and maintaining an environment that is enabled by the appropriate regulatory framework, timely and affordable access to market.
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“The commission is also committed to zero tolerance for infractions, heightened investor confidence and awareness, innovative product development and good governance practices. There is a need to restore investor confidence and improve the participation of retail investors in the market.
“The demography of investors in the country’s capital market shows that our young population do not participate in the capital market, and only a few Nigerians invest in the capital market. This situation creates a huge challenge to the growth of our market and the commission is striving to change the narrative by instilling a fair, transparent and orderly market.’’
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What you should know
- SEC has been at the forefront of the fight against Ponzi schemes and illegal capital market operators, by stepping up its enforcement actions to safeguard the investing public, following an upsurge in their activities since 2019.
- The commission had in March 2020, warned stakeholders and the investing public against the activities of some unlawful/unlicensed market operators and promoters of fraudulent schemes as they listed 12 fraudulent Ponzi schemes with bogus investment and return claims.
- SEC had in August 2021, while reading the riot act vowed to clamp down on illegal capital market operators, especially operators of Ponzi Schemes as the commission has identified their activities as a huge problem for the economy and the country in general.