SEC tells Nigerians to report suspected illegal investment schemes for action

The Securities and Exchange Commission (SEC) has urged Nigerians to report any suspected illegal investment scheme to the commission for proper investigation and necessary action.

The Commission said this in a notice issued on Thursday to the investing public, warning that Ponzi investment schemes pose great danger to the growth of the capital market.

In its latest advisory, the Commission warned the public about the growing threats and risks posed by Ponzi schemes, illegal investment operations, and unregistered digital assets platforms.

It explained that fraudulent entities and individuals have continued to exploit unsuspecting investors through deceptive promises of high returns, often leveraging the allure of digital assets to create an erroneous perception 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 subjecting themselves to the prescribed processes for obtaining the prior approval of the SEC.

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“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 should verify the registration status of the company or individual offering the investment through the SEC’s website: https://sec.gov.ng/cmos.

The Commission explained that Section 196 (3) of the Investments and Securities Act, 2025, criminalises the promotion and operation of prohibited/unregistered schemes.

“This violation is punishable upon conviction by a fine of not less than N20m or a prison term of 10 years or both”, the Commission warned.

The SEC said 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.

Iheanyi Nwachukwu

Iheanyi Nwachukwu, is a creative content writer with almost two decades journalism experience writing on banking, finance, capital markets, and tax. The multiple awards winning journalist is Assistant Editor, BusinessDay. Iheanyi holds BSc Degree in Economics from Imo State University; Master of Science (MSc) Degree in Management from University of Lagos. Iheanyi has attended several work-related trainings including (i) Advanced Writing and Reporting Skills (Pan African University, Lagos); (ii) News Agency Journalism (Indian Institute of Mass Communication {IIMC}, New Delhi, India); and (iii) Capital Markets Development and Regulations (International Law Institute {ILI} of Georgetown University, Washington DC, USA). Other trainings Iheanyi attended include: Economic/Political Risk Analysis (By Thomson Reuters Foundation); International Financial Journalism (IFJ) (By PMA Media Training, UK); Effective Business Writing Skills (By Phillips Consulting); Reporting on Corporate Governance (By International Finance Corporation (IFC) & Thomson Reuters Foundation UK); etc. In addition, he has participated in high-level economy & markets events in Dubai, South Africa, Morocco, and other African countries like Zambia, Ghana and Gambia.