The Securities and Exchange Commission (SEC) has issued a fresh warning to the Nigerian investing public, urging vigilance against fraudulent investment schemes, including Ponzi operations and unregistered digital asset platforms.
In a public notice released on Thursday, the Commission emphasized the severe risks posed by these illegal investment activities.
The commission stressed the importance of regulatory compliance to safeguard the stability of Nigeria’s capital markets.
Rising Threats from Unregistered Investment Schemes
The SEC cautioned that fraudulent entities and individuals continue to exploit 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.”
Steps to Avoid Investment Scams
To protect investors, the SEC advised potential stakeholders to conduct thorough due diligence before investing and to verify the registration status of financial firms through the official SEC database: https://sec.gov.ng/cmos.
Furthermore, Section 196(3) of the Investments and Securities Act, 2025 criminalizes the promotion and operation of unregistered investment schemes, making violators subject to 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.
SEC’s Commitment to Enforcing Financial Regulations
The SEC reaffirmed its dedication to identifying and prosecuting offenders who engage 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 concluded.
The Commission’s renewed crackdown on fraudulent investment platforms underscores the critical need for investor awareness, robust regulatory enforcement, and public cooperation in ensuring financial security and trust in Nigeria’s capital markets.
What you should know
The recent collapse of digital asset trading platform CBEX has reignited urgent calls for stricter government regulation and enforcement.
- Operating without any official social media presence, CBEX presented itself as a high-yield investment platform but ultimately left its users in financial disarray.
- The platform’s sudden crash, which left investors unable to access their funds, has caused financial losses exceeding N2.4 billion and drawn attention to the critical gaps in Nigeria’s regulatory framework for digital investments.
This failure has sparked widespread outrage and called into question the oversight of government agencies tasked with regulating such platforms.
