SEC Takes Stronger Stance Against Ponzi Schemes
The Securities and Exchange Commission (SEC) has announced stricter penalties for promoters and operators of prohibited schemes, such as Ponzi schemes, under the newly signed Investments and Securities Act 2025. In a statement released on Tuesday in Abuja, SEC Director-General Emomotimi Agama confirmed that offenders could face a fine of not less than N20 million, imprisonment for up to 10 years, or both.
Strengthening Nigeria’s Capital Market Framework
The new Act, signed recently by President Bola Tinubu, aims to enhance the legal framework governing Nigeria’s capital market. Agama noted that the commission previously lacked sufficient legal powers to effectively prosecute Ponzi scheme operators. This gap in the law made it difficult to hold offenders accountable. The ISA 2025 will now allow the SEC to take stronger action, protecting investors and promoting greater transparency in the market.
New Provisions for Market Integrity and Investor Protection
Agama emphasized that the N20 million penalty is only one part of the broader sanctions. He clarified that profits gained from fraudulent activities would also be recovered, as the goal of the law is not only to impose fines but also to deter potential offenders. “Protecting investors in Nigeria is a cardinal responsibility of SEC,” Agama stated, underlining the commission’s commitment to preventing further exploitation of Nigerian investors.
Aligning with International Best Practices
The SEC also highlighted that the new Act includes transformative provisions aimed at aligning Nigeria’s market operations with global standards. The repealed Investments and Securities Act No. 29 of 2007 has been replaced with this new legislation, ensuring more robust market regulation and investor confidence.
