The Nigerian Senate has taken decisive action to address the alarming rise of Ponzi schemes in the country.
Following the collapse of the Crypto Bullion Exchange (CBEX), which allegedly defrauded investors of more than N1.3 trillion, the Senate has mandated a joint committee to investigate the matter.
The decision of the Senate followed a motion sponsored by Senator Adetokunbo Abiru (Lagos East).
Moving the motion, the lawmaker expressed deep concern over the unchecked spread of fraudulent investment schemes, including the infamous MMM Nigeria (2016), MBA Forex (2020), and most recently CBEX, which lured millions of Nigerians with promises of high returns on digital assets.
Lawmakers warned that the collapse of CBEX has had devastating financial and psychological consequences for victims, pushing some into depression, family breakdowns, and even suicide.
The Senate expressed shock that CBEX operated unchecked for months despite its large-scale activities and online visibility, with no timely intervention from regulatory agencies.
The joint committee is expected to hold a public hearing in the coming weeks and submit its findings within one month.
The investigation aimed to uncover the truth behind the collapse of CBEX and other Ponzi schemes, and to identify ways to prevent such incidents in the future.
The Economic and Financial Crimes Commission (EFCC) has been actively involved in addressing the issue of Ponzi schemes.
In April, the EFCC warned Nigerians against investing in such schemes and listed 58 companies suspected of operating Ponzi schemes.
The Commission also obtained a court order to arrest and detain six promoters of CBEX over alleged investment fraud amounting to over $1 billion.
The Senate’s decision highlighted the need for regulatory agencies such as the Securities and Exchange Commission (SEC), the Central Bank of Nigeria (CBN), the Nigerian Financial Intelligence Unit (NFIU), and the EFCC to work together to prevent and detect financial crimes.
The investigation will examine the role of these agencies in regulating and overseeing the activities of companies like CBEX.
The outcome of the investigation is expected to provide insights into the operations of Ponzi schemes and the measures needed to prevent such incidents in the future.
