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SEC vows crackdown on Ponzi schemes, illegal fund managers

“The Nigerian financial sector is experiencing a resurgence of Ponzi schemes and illegal fund managers.”

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The Securities and Exchange Commission (SEC) has said it will continue to crack down on Ponzi schemes and illegal fund managers amid the recent resurgence of their activities.

Mr Lamido Yuguda, Director-General, SEC, disclosed this at an enlightenment workshop and investor clinic session with the Federal Ministry of Finance, Budget and National Planning and its agencies in Abuja on Wednesday.

Yuguda was quoted in a statement as saying, “The Nigerian financial sector is experiencing a resurgence of Ponzi schemes and illegal fund managers.”

According to him, they lure subscribers by making promises of huge and unjustifiable returns on investment and still enjoy massive patronage from Nigerians.

The director general added that the problem remained a concern for financial sector regulators.

He sad: “Thus, the commission is poised to continue to apply measures and seek the cooperation of relevant stakeholders to combat the activities of these unlawful schemes, which have undermined the reputation of our financial markets and dampened investors’ confidence, among other things.

“The SEC firmly believes that the Nigerian capital market can attain its potentials if market operators/participants contribute their respective quotas to the growth of the market.”

He expressed SEC’s commitment to ensuring and maintaining an environment enabled by the appropriate regulatory framework, timely and affordable access to market, zero-tolerance for infractions, heightened investor confidence and awareness, innovative product development and good governance practices.

Yuguda added that there was an urgent need to restore investor confidence and improve the participation of retail investors in the capital market, as the demographics of current investors showed that youths shunned the market.

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