The Economic and Financial Crimes Commission (EFCC) has sounded a loud alarm over the growing menace of Ponzi schemes in Nigeria. The anti-graft commission says that the illicit investment schemes are not only defrauding citizens but also undermining the economic stability of the nation and national security.
In a recent public sensitization campaign, the EFCC said that Ponzi schemes are still luring people with promises of high returns on investment, but they usually disappear with victims’ funds. The scams, often disguised as cooperative societies, crypto investment opportunities, or online trading platforms, have swindled billions of naira from unsuspecting Nigerians.
The commission called on citizens to stop pursuing elusive profits and instead invest in licensed financial institutions. Authorities called for the greed and desperation to double money as the main reasons why many are victims.
Flashback:
In 2016, the MMM scheme collapse hit more than three million Nigerians. Most individuals lost their entire savings. Notwithstanding that experience, such scams continue to resurface. In 2021, the commission arrested some operators of Chinmark, an bogus investment firm which offered monthly returns of as much as 30%. Victims from various parts of the country reported losses in hundreds of millions of naira.
The EFCC asserts that the schemes also erode confidence in the financial system. The greater the number of victims, the fewer investors will invest in genuine business ventures. The result is loss of investor confidence, capital market weakness, and the increase in unemployment when businesses are unable to mobilize funds.
Apart from economic costs, Ponzi schemes pose a threat to national security as viewed by the EFCC. When citizens lose money to scams, national fury rises, and instability is likely. Angry victims usually mobilize protests or riots, which increase pressure on already strained law enforcement agencies.
The commission also warned that financial fraud proceeds are used by fraudsters to fund criminal operations, including cybercrime, political thuggery, and even terrorism. The authorities state this nexus between organized crime and financial fraud makes it essential for citizens to be alert.
EFCC has now partnered with community leaders, the media, and religious organizations to inform Nigerians on how to spot and shun the so-called investment scams. It also called on victims to report the cases quickly.
It advised people to always cross-check the status of registration of any company with the Corporate Affairs Commission (CAC) and ascertain that the company is registered by the Securities and Exchange Commission (SEC) before any form of investment.
The warning comes as most Nigerians are already dealing with increasing inflation, unemployment, and economic hardship—conditions fraudsters capitalize on to sell false hope.
To conclude, the EFCC encourages Nigerians to avoid any scheme that promises fast and high returns. If it sounds too good to be true, then chances are that it is. Public awareness, police efforts, and individual watchfulness remain the best tools to fight this growing threat.
