SEC reaffirms crackdown on ponzi scheme operators
SECjThe Securities and Exchange Commission (SEC) has restated its commitment to collaborating with law enforcement agencies to clamp down on operators of ponzi schemes across the country.
John Achile, the SEC’s divisional head of legal and enforcement, made this known at the commission’s Journalists’ Academy 2025 in Lagos, themed ‘The ISA 2025 and The Future of Nigeria’s Capital Market: Innovation, Protection, and Growth’.
Speaking on ‘Combating Investment Fraud, Ponzi Schemes and Illegal Investments’, Achile said the commission will intensify efforts to identify and prosecute ponzi scheme promoters under the Investments and Securities Act (ISA) 2025.
He said the SEC is deepening its partnership with the Economic and Financial Crimes Commission (EFCC), the Nigeria Police Force (NPF), and the Office of the Attorney-General of the Federation to dismantle fraudulent investment operations.
According to him, the SEC will continue to freeze bank accounts and seal business premises belonging to perpetrators, who typically use funds from new investors to pay older ones while relying on fake or incomplete documentation to sustain their operations.
Achile highlighted common red flags associated with ponzi schemes, including unusually high returns with little or no risk, consistent payouts despite economic downturns, a lack of regulatory registration, and promoters whose identities are often concealed.
He urged the investing public to verify claims with relevant regulators before committing their funds and warned Nigerians to be wary of “get-rich-quick” schemes.
“Ponzi scheme could be structured as investment in agricultural business or processing along the value chain, investment in Bitcoin or cryptocurrency or other digital currencies, and investment in gold coins or precious stones,” he explained.
Achile added that ponzi schemes lead to significant financial losses, erode investor confidence, and contribute to broader socio-economic challenges.
The SEC had earlier, on September 28, warned Nigerians about artificial intelligence (AI)-driven scams that lure investors with promises of guaranteed profits and fake celebrity endorsements.
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