Ponzi alert: SEC cautions public against fake online investment schemes

The Securities and Exchange Commission (SEC) has issued a fresh warning to Nigerians over the rising wave of unregistered online investment schemes being aggressively promoted across social media platforms, cautioning that many of them exhibit characteristics of Ponzi operations.

In a public notice dated May 8, 2026, and shared via its official X handle, the Commission said it had observed a significant increase in investment solicitations on platforms such as WhatsApp, Instagram, Telegram, Facebook, TikTok, and other digital channels.

The regulator stressed that many of these platforms are neither registered nor authorised to operate within Nigeria’s capital market and often promise unrealistic or guaranteed returns to unsuspecting investors.

According to the SEC, several of the schemes currently circulating online show clear indicators of Ponzi or prohibited investment structures, while others illegally provide investment advisory services without regulatory approval.

“The attention of the Securities and Exchange Commission has been drawn to the increasing promotion of unregistered online investment schemes on social media applications and websites,” the Commission stated.

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It added that “many of these investment schemes exhibit characteristics of Ponzi or prohibited investment schemes, while some operators also provide unauthorized investment services to members of the public.”

The SEC warned Nigerians to avoid any investment platforms that guarantee unusually high or risk-free returns, noting that such claims are often used to lure unsuspecting victims into fraudulent arrangements.

The Commission advised the public to conduct proper due diligence before investing in any financial product or platform and to verify the registration status of companies through its official databases.

It also cautioned against relying on financial advice from unlicensed individuals or entities, stressing that only SEC-registered operators are legally permitted to provide investment and advisory services in Nigeria.

“The Commission reiterates that investors should verify the registration status of any company or platform before committing funds,” the statement added.

The latest advisory comes amid intensified regulatory actions against suspected illegal investment operators in Nigeria.

In previous alerts, the SEC flagged several entities operating without approval, including Glorious Wealth Fund, which was accused of illegally soliciting investments while falsely claiming links to Nigerian financial markets through its website.

The Commission also previously warned against involvement in digital asset schemes such as “Shalom Coin (SHLM),” which was promoted online as a meme coin investment opportunity despite lacking regulatory approval.

Similarly, the SEC earlier raised concerns about Silverkuun Investment Cooperative Society, describing it as an entity falsely operating as an investment adviser and fund manager while offering high-return investment products to the public.

The regulator referenced the Investments and Securities Act (ISA) 2025, which stipulates that only registered entities are permitted to solicit funds, promote investment products, or provide advisory services within Nigeria’s capital market.

It warned that participation in unregistered schemes exposes investors to significant financial risk, including total loss of funds.

Reaffirming its commitment to safeguarding the investing public, the Commission said it will continue to intensify surveillance, enforcement actions, and public awareness campaigns against fraudulent operators.

It also urged Nigerians to remain vigilant, emphasizing that investor education and due diligence remain key tools in combating financial scams in the digital era.

“The Commission remains committed to investor protection and the eradication of fraudulent investment schemes in Nigeria’s capital market,” it said.