The Securities and Exchange Commission (SEC) has disclosed that Nigerians have lost an estimated N316 billion to Ponzi schemes and unlicensed fund managers over the years, attributing the rise of such scams to greed, ignorance, and low financial literacy.
The Head of the SEC’s FinTech and Innovation Department, AbdulRasheed Dan-Abu, made this known at the Commission’s Journalists’ Academy in Abuja, a workshop aimed at equipping financial reporters with tools to identify and combat investment fraud.
Dan-Abu described Ponzi schemes as fraudulent investment operations that pay returns to earlier investors from funds contributed by new participants rather than through legitimate business activities.
“These schemes do not create any real economic value. They simply recycle investors’ money until the system collapses and the operators disappear,” he explained.
According to him, the growing desire for quick wealth has made many Nigerians susceptible to such scams.
“Everyone wants to get rich overnight, and that is why people fall victim. Even the educated are not exempt. Education does not cure greed,” he noted.
He recalled how the infamous MMM Nigeria scheme deceived thousands of investors with promises of 30 percent monthly returns. Despite its collapse, he said, many victims still reinvested in its relaunch attempts out of desperation to recover lost funds.
“After MMM shut down, promoters came back claiming people could regain access to their lost money if they paid a fee—and they still paid. That’s how greed clouds judgment,” he said.
Dan-Abu also mentioned another network, New Nation, Women in Oil, which posed as a government-backed empowerment initiative and defrauded more than 155,000 women, many of whom sold property to participate.
Data presented by the SEC showed widespread losses: N100 million each in Cow Lane and Durrell Nigeria Ltd, N235 million in Now-Now Alert, N400 million each in G-Circle Investment and Box Value Trading, and N900 million in Yuan Dong.
Other major cases include Dantata Success and Prof Coy (N1.2–N2 billion), Famzi Intbiz (N2.5 billion), Bara Finance (N3.5 billion), Galaxy Construction and Transportation (over N7 billion), and MMM Nigeria, which cost investors about N18 billion.
Similarly, Nospecto Oil and Gas and other “wonder banks” collectively defrauded investors of N106.9 billion, while one ongoing investigation involves over N174 billion in losses.
The SEC’s report, however, did not include the more recent Crypto Bridge Exchange (CBEX) case, a digital platform alleged to have defrauded Nigerians of more than N1.3 trillion.
Dan-Abu warned that fraudsters now exploit social media to target victims, using fake testimonials and high-return promises.
“They create WhatsApp and Telegram groups, post fabricated proofs of payment, and lure people with unrealistic returns. But there is no legitimate business that offers high profit without risk,” he cautioned.
He urged investors to verify the registration status of any investment firm with the SEC before committing funds.
“If a company is not registered with the Commission, it is already illegal. Always confirm first — it’s your hard-earned money,” he said.
He also encouraged journalists to continue raising public awareness and exposing fraudulent operators.
“The media can save thousands of people from becoming victims. Regular reporting could protect your neighbour, your friend, or even your family,” he added.
In his remarks, SEC Director-General Dr. Emomotimi Agama stressed the need for effective regulation of digital assets to protect investors and build confidence in Nigeria’s financial system.
Represented by the SEC’s Head of External Relations, Efe Ebelo, Agama noted that digital assets are now a key part of modern finance and must be governed by transparency and accountability.
“Regulation is not about restriction; it’s about building trust and ensuring innovation serves progress, not exploitation,” he said.
Agama highlighted that Nigeria ranks among the top countries for digital asset adoption, with more than one-third of its population engaged in cryptocurrency-related activities. However, he warned that this growth has also fueled scams, phishing attacks, and fake wallet platforms.
He explained that the SEC’s 2022 Rules on Digital Assets established a regulatory framework for virtual asset service providers, covering licensing, anti-money laundering compliance, and transaction transparency.
The Commission, he added, is collaborating with the Central Bank of Nigeria (CBN) and the Economic and Financial Crimes Commission (EFCC) to freeze illicit digital wallets, trace suspicious transactions through blockchain analysis, and recover stolen funds.
“Globally, regulators face a delicate balance — clamp down too hard, and innovation moves offshore; regulate too softly, and risks multiply. Our responsibility is to strike the right balance,” he said.
Agama concluded by stressing that while the future of finance is digital, it must remain ethical and transparent.
“In this new era, trust is the ultimate currency — and our greatest duty as regulators is to protect it,” he affirmed.
