ARCON raises concerns on digital ad fraud, warns of rising scams in unregulated online space

The Director-General of the Advertising Regulatory Council of Nigeria (ARCON), Dr. Olalekan Fadolapo, has raised alarm over the devastating economic impact of unregulated digital advertising in Nigeria, revealing that fraudulent online campaigns—including the recent CBEX cryptocurrency scandal—have cost Nigerian consumers as much as N1.5 trillion.

Dr. Fadolapo made the revelation on Thursday while speaking at the ASP Stakeholders’ Forum, held at Sheba Event Centre, Maryland, Lagos.

The forum convened leaders and regulators from across the advertising and media industries to address mounting concerns over unethical digital marketing practices.

Citing recent high-profile fraud cases, the ARCON DG noted that the digital advertising ecosystem has become a breeding ground for criminal exploitation of Nigerian consumers, largely due to the borderless nature of online platforms and the lack of rigorous vetting for digital content.

“The CBEX case alone allegedly cost the Nigerian economy between N1.2 and N1.5 trillion,” Fadolapo said. “We’ve also seen AI-generated celebrity endorsements and fraudulent land investment schemes destroy lives and livelihoods. It is our duty as a regulator to stop this.”

He pointed to one such real estate scam, where a company used popular Nigerian celebrities in advertisements to sell land to unsuspecting buyers.

“Shortly after, one of the celebrities came out to disassociate from the company, claiming ignorance. But by then, people had already oversubscribed. The damage was done,” he added.

Fadolapo warned that the digital economy had outpaced regulatory frameworks, making traditional tools insufficient.

“In the past, advertising regulation was tied to location and physical presence. Today, someone sitting anywhere in the world can target the Nigerian market online without any oversight,” he said.

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He expressed particular concern over misleading financial service adverts on platforms like TikTok. “Before you scroll past two videos, you’re already seeing dubious claims from so-called investment firms or digital lenders offering fake deals.”

To combat these threats, ARCON is intensifying enforcement of pre-exposure advertisement vetting under the ARCON Act 2022. Joe-Eugene Onuorah, FRPA, who delivered a technical presentation at the forum, outlined the legal requirements for vetting all marketing communications targeted at Nigerians.

Referencing Section 54 of the Act, Onuorah stated: “It is an offence for any individual, brand, or corporate body to place advertisements in any medium targeting Nigeria without prior approval of the Advertising Standards Panel (ASP).”

He explained that only registered and certified advertising practitioners are permitted to submit content for vetting. Exceptions are limited to public service notices, obituaries, and job postings.

Onuorah also presented performance data from ARCON’s vetting process for the year so far.

Between January and May 2025, ARCON received 911 applications, of which 662 were approved—an overall approval rate of 73%.

The data, he said, indicates either improved industry understanding of regulatory requirements or the effectiveness of ARCON’s intensified engagement with stakeholders.

Onuorah reiterated the ASP’s core mission: “Our duty is to protect the consumer, competitors, and the public from harmful, misleading, offensive, or socially irresponsible advertising.”

The forum attracted high-level participation from across the industry, including delegates from the Outdoor Advertising Association of Nigeria (OAAN), Media Independent Practitioners Association of Nigeria (MIPAN), Experiential Marketers Association of Nigeria (EXMAN), Association of Advertising Agencies of Nigeria (AAAN), and Broadcasting Organizations of Nigeria (BON).

As Nigeria’s digital economy continues to expand rapidly, ARCON says it will double down on its mandate to ensure that advertising practices—both online and offline—uphold public trust, protect consumer rights, and reflect national values.