Securities and Exchange Commission (SEC) has urged Nigerians to report any suspected illegal investment schemes to the commission for proper investigation and necessary action.
This is in the light of the recent collapse of Crypto Bridge Exchange (CBEX).
The Commission issued a notice on Thursday to the investing public, warning that Ponzi investment schemes pose a significant danger to the growth of the capital market.
In its latest advisory, the Commission highlighted the growing threats and risks posed by Ponzi schemes, illegal investment operations, and unregistered digital asset platforms.
It explained that fraudulent entities and individuals continue to exploit unsuspecting investors with deceptive promises of high returns, often leveraging the allure of digital assets to create a false sense of legitimacy.
“The public is strongly advised to be wary of investment opportunities that promise guaranteed or unusually high returns with little or no risk.
“These include unregistered platforms offering cryptocurrency investments, forex trading, or blockchain-based schemes, without undergoing the prescribed processes to obtain prior approval from the SEC.
“The SEC reiterates in this regard that, ‘If it sounds too good to be true, it likely is.’”
The Commission urged potential investors to conduct thorough due diligence before investing and to verify the registration status of the company or individual offering the investment through the SEC’s website.
The Commission explained that Section 196(3) of the Investments and Securities Act, 2025, criminalizes the promotion and operation of prohibited or unregistered schemes.
“This violation is punishable, upon conviction, by a fine of not less than ₦20 million or a prison term of 10 years, or both,” the Commission warned.
The SEC stated that it is fully committed to identifying and prosecuting offenders to the full extent of the law.
“We encourage the public to partner with the SEC to safeguard the integrity of the investment environment in Nigeria by promptly reporting suspected illegal investment schemes to the SEC,” the notice concluded.