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Business News of Tuesday, 30 August 2022

Source: vanguardngr.com

SEC to establish collaborations in fight against ponzi schemes

Securities and Exchange Commission (SEC) Securities and Exchange Commission (SEC)

Director General of the Securities and Exchange Commission, Mr. Lamido Yuguda, has said the Commission will collaborate and engage relevant agencies to eliminate all Ponzi schemes in the capital market.

Speaking in Abuja on the menace of ponzi schemes in Nigeria, Yuguda advised investors to always check with SEC for registered and authorised operators in the Nigerian financial market.

He stated: “We have their list on the SEC website and we have always said that if you go to an operator or when an operator approaches you, you must confirm that he is a licensed operator with the SEC. We have done a lot of sensitizations in terms of seminars, webinars all in an effort to discourage people from going to ponzi schemes.

“Unfortunately, a lot of people continue to patronize the schemes; we have had cases that have been reported to us; our enforcement department and the police unit have been on many of these cases that have been reported to us trying to resolve them.”

According to him, it is not very difficult to identify a ponzi scheme as they usually promise unreasonably high returns just to lure people.

He added, “There are people who think they can be amongst the first people to go in and probably go out before it collapses but you may be taking a huge risk because you do not know if you are the first, may be the 1000th and could be that it is your own money that could get trapped. It is important for investors to understand the tell-tale signs of a Ponzi scheme and to alert the commission if they need some clarity.”

The SEC DG disclosed that the Commission has been working with other agencies of the government in terms of reducing the access of ponzi schemes to the advertising platforms, the print media or electronic media i.e. the radio and television.

“These collaborations are very important because Ponzi schemes are cancers to the capital market, a lot of money has been lost and it is unacceptable to continue to have this kind of investment losses by people.

“In terms of the synergies between the Commission and the law enforcement on the fight against Ponzi schemes, I can say that there is very good synergy and harmony between the SEC and the law enforcement agencies. It is worthy to mention that the SEC has a detachment of the Nigerian Police working directly with the SEC on capital market matters including Ponzi schemes and we have a good collaboration with the Nigerian Financial Intelligence Unit, the EFCC especially on the fight against money laundry and Ponzi schemes.”