SEC Moves to Tighten Inter-Agency Action Against Ponzi Scheme Promoters
By Patience Ikpeme
The Securities and Exchange Commission (SEC) has vowed to intensify collaboration with relevant government agencies to identify, investigate and prosecute promoters of Ponzi schemes across the country, in line with the Investments and Securities Act (ISA) 2025.
The Divisional Head, Legal and Enforcement at the SEC, Mr. John Achile, made this known at the Commission’s Journalists’ Academy 2025 held in Lagos. Achile said the Commission is deepening joint efforts with key agencies to curb the spread of fraudulent investment operations that continue to target unsuspecting Nigerians.
According to him, “the Commission would strengthen various inter-agency collaborations to identify the promoters and those trading the assets.” He added that SEC will maintain close cooperation with law enforcement bodies, explaining that, “SEC would continue to ensure criminal investigation and prosecution in collaboration with the Nigeria Police Force, EFCC and the Office of the Attorney General of the Federation, among others.”
Delivering a presentation on, “Combating Investments Fraud, Ponzi Schemes and Illegal Investments,” Achile said the Commission remains committed to shutting down unregistered operations that lure the public with unrealistic investment promises. He stated that SEC will “continue to freeze the accounts and seal up offices of the perpetrators.”
Achile explained the typical features of Ponzi schemes, noting that the operations are sustained only by the entry of new investors whose funds are used to pay earlier participants. “Investors are usually provided with fake documents or incomplete documents,” he said.
He outlined other characteristics, including unusually high returns with little or no risk, promises of consistent positive returns despite harsh economic conditions, lack of registration with appropriate regulators, and promoters who are unknown to authorities.
The SEC enforcement chief urged Nigerians to exercise caution and carry out proper checks before committing their funds. He warned the public to be wary of schemes that promise quick and guaranteed wealth, saying, “conduct thorough due diligence and be skeptical of ‘get-rich-quick’ promises in order not to burn your hands.” He further advised investors to make enquiries from relevant regulators before investing in any venture.
Achile noted that fraudulent schemes often present themselves as legitimate ventures such as agricultural investments, cryptocurrency or Bitcoin-related products, digital currency operations, or investments in gold coins and precious stones.
He warned that the consequences of Ponzi schemes extend beyond individual financial losses. According to him, they “undermine confidence in the financial markets,” erode trust in regulators and government when failures occur, reduce deposits in commercial banks, divert savings, cause heavy losses to investors, and create broader social and economic problems.
This year’s Journalists’ Academy is themed: “The ISA 2025 and the Future of Nigeria’s Capital Market: Innovation, Protection, and Growth.”
