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Ponzi Schemes Threat To Investors’ Protection – SEC


Director-general of the Securities and Exchange Commission, Mr Lamido Yuguda has said activities of Ponzi schemes have been described as a threat to the protection of investors, the functioning of a fair and orderly financial market as well as the development of the economy at large.


The DG stated this during the opening of a two-day webinar organised by the Attorney General Alliance-Africa in collaboration with the Securities and Exchange Commission (SEC), Tuesday.


Yuguda said the devastating impact of the COVID-19 pandemic on the Nigerian economy, the low-interest rate environment, coupled with the increased use of online services to interact and transact, has helped the proliferation of Ponzi schemes.


He said ponzi schemes operators have capitalised on the harsh economic climate to offer unrealistic returns on investment to unsuspecting investors. These illegal schemes have also been able to solicit new investors and expand their operations through the increased use of online services.


Yuguda however stated that the SEC has a statutory duty to promote investor education and the training of persons in the capital market, saying that the programme is organised in furtherance of that statutory mandate.


According to him, “This capacity building programme will afford participants the opportunity to learn contemporary and innovative ways of combating and curbing the menace of Ponzi schemes in Nigeria.


“I believe the knowledge gathered from this programme will provide participants new ways of approaching, assessing and tackling the growing problem of Ponzi Schemes”.


He described the theme of the programmeas apt, and its organization timely, in view of the contemporary challenges confronting the Nigerian financial sector and its regulators, by the activities of Ponzi Schemes.


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