The Securities and Exchange Commission of Nigeria (SEC Nigeria) has issued a fresh advisory urging investors to exercise greater caution when considering investment opportunities, particularly those involving unauthorized digital asset platforms and Ponzi schemes.
In a statement released on April 24, 2025, the Commission stressed the ongoing risks tied to illegal investment activities. It reiterated the importance of regulatory compliance in ensuring the integrity and stability of Nigeria’s capital markets.
According to the SEC, fraudulent entities continue to exploit unsuspecting Nigerians by promoting investment offers that promise high, guaranteed returns with little to no risk.
The Commission highlighted that many of schemes, which often involve unregistered cryptocurrency platforms, forex trading operations, and blockchain-based programs, operate without regulatory approval.
Also read, EFCC Files Fraud Charges Against Afriq Arbitrage System Over Unlicensed Crypto Investment Scheme
The SEC reminded investors that if an offer appears too good to be true, it most likely is. It advised the public to perform thorough due diligence before investing and verify any financial institution registration status through its official portal.
The Commission also highlighted the new Investments and Securities Act, 2025, strengthening sector regulation.
Section 196(3) of the Act criminalizes the promotion and operation of unregistered investment schemes. Violators, if convicted, face penalties of at least ₦20 million in fines, a prison sentence of up to 10 years, or both.
Despite earlier plans to expand its Accelerated Regulatory Incubation Programme (ARIP) for cryptocurrency startups, the Commission has delayed the issuance of new provisional licenses.
Director General Emomotimi Agama explained that further due diligence was necessary to safeguard the interests of investors and maintain oversight standards.
The Commission’s latest warning comes in the wake of the collapse of CBEX, a digital asset trading platform that attracted public investment with promises of high returns.
Operating without any verified presence on major social media platforms, CBEX left its investors unable to recover their funds. Losses linked to the platform’s sudden shutdown have reportedly surpassed ₦2.4 billion ($1.48 billion), exposing gaps in Nigeria’s regulatory system concerning digital investments.
Our Thoughts
The SEC’s renewed caution reflects an urgent need for Nigerian investors to become more skeptical of high-return offers, especially within the loosely regulated digital asset space.
From our experience covering Africa’s financial sector, regulatory warnings alone are not enough, stronger enforcement actions and public education campaigns must be taken to curb these fraudulent activities.
The situation with CBEX demonstrates that platforms operating outside recognized oversight structures continue to pose real risks.
While regulation can sometimes lag behind innovation, it is critical that financial authorities strengthen coordination among agencies, improve transparency around registered platforms, and build systems that encourage investor confidence based on trust and accountability rather than unchecked promises.
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