Most Nigerians have heard about Ponzi schemes. From MMM and Loom to CBEX (Crypto Bridge Exchange), these scams have resulted in loss of billions of funds, broken trust, and financial hardship. Although the names and platforms change, the game stays the same, and criminals are playing it better than ever. What’s their most effective tool? Not only technology, but psychology. It’s called social engineering, and it’s generating a new wave of digital fraud that’s tougher to identify and even more difficult to stop. Social engineering is the manipulation of human behavior to accomplish a deceptive aim. Rather than hacking computers, fraudsters hack people, using trust, fear, urgency, and how to trick victims into handing over money or sensitive information. Modern Ponzi schemes employ this strategy to an extreme, particularly through WhatsApp and Telegram groups, dubious investment sites, and phishing links appearing as opportunities. It usually begins casually. A friend sends you a message about a good investment group or invites you to a Telegram channel where people are earning daily. The administrators provide testimonials, screenshots of payouts, and links to credible websites. You are informed you can start with as low as ₦5,000 or ₦10,000. Simply “invest,” refer a few individuals, and see your money rise.
In reality, many of these platforms are nothing more than digital scam presented to be a legitimate investment. dressed in convincing branding. A notable example CBEX (Crypto Bridge Exchange), a cryptocurrency Ponzi scheme that promised investors a 100% return within 30 days crashed recently. Promoted aggressively through WhatsApp messages and groups, Telegram groups, media outlets and referral programs, it quickly attracted over 500,000 Nigerians, many of whom were unaware it wasn’t registered with the Securities and Exchange Commission (SEC). The platform had no actual trading activity it merely cycled money from new participants to pay early joiners. When recruitment slowed, the system collapsed, leaving behind ₦1.3 trillion in reported losses. CBEX didn’t just disappear with people’s money, it left shattered trust and widespread financial trauma in its wake.
This isn’t an isolated case. Before CBEX, schemes like MMM, Loom Money Nigeria swept through social platforms in 2016 and 2019 respectively, enticing thousands of people with promises of more than 100% returns on small contributions. It spread through peer referrals and group chats, preying on social trust. Ponzi scams such as CBEX, MMM, and Loom, among others, collapsed as the flood of new members dried up. These cases demonstrate a troubling trend. Fraudsters use popular chat applications and emotional manipulation to execute large financial scams, typically targeting the most enthusiastic and vulnerable members of society.
Social trust, however, is the true force behind these systems. A friend, relative, or former coworker who has endorsed it is the reason why many individuals join. Social engineering functions precisely like that. Our personal networks are turned into weapons. It substitutes blind trust with due diligence. Even the referrers are frequently victims, not realising they are contributing to the scam’s continuation.
It frequently takes a combination of caution, curiosity, and common sense to recognize the warning signals of a scam. It’s not an opportunity; it’s bait when someone offers you 30%, 50%, or even double your money in a few days or months. Real investments don’t promise unrealistically quick profits. Similar to this, any platform that primarily depends on referrals the “bring two people and earn more” model is more focused on expanding your network than on your personal development. Even websites can be deceptive in the modern digital age. Cloned websites with dubious URLs and fake testimonials are hosted by numerous scam operations. Red flags that others have already identified can frequently be found by conducting a quick internet search using the platform’s name and the word “scam.” Examine the platform’s creators carefully. Are they genuine? Do they have any digital footprint or professional background? Real companies don’t usually hide in the shadows.
Also, pay attention to how the offer is presented. If it’s just being promoted via WhatsApp broadcasts, Telegram groups, or anonymous celebrities, it’s time to calm down. These platforms make it easier for scammers to disappear overnight. And if you’re instructed to act “fast” before an untrue deadline expires, that urgency is part of the deception. Pressure is not an indicator of effective financial decision-making.
The truth is that not all digital investment schemes are fraudulent, but the ease with which criminals exploit social trust, and our desire for financial breakthroughs has made due diligence a necessity. And here’s where institutions come in. Regulators, law enforcement, telecommunications providers, and even the media must take an active part in detecting fraud before it becomes widespread. The consequences of silence are always more severe than the cost of speaking up. Until law enforcement catches up, the burden rests with the public. We must begin by questioning, properly verifying, and acting with cautiousness because in the world of modern Ponzi schemes, trust is the currency criminals steal first.
. Adesola, CC, Security+ Cybersecurity Analyst
Email: [email protected]
Join BusinessDay whatsapp Channel, to stay up to date
Open In Whatsapp
