Nigeria’s capital market apex regulatory body on Thursday cautioned potential capital market investors against putting their funds in schemes that promise unwarranted high returns.
Addressing local and international investors at a webinar in Abuja, Nigeria’s capital, Tunde Kamali, head of investor education at the Securities and Exchange Commission (SEC), said that fraudsters usually attracted their investors through offer of commissions, pressure tactics and fictitious track records, among others.
Kamali called on investors to always ask, check and confirm with the commission before investing in those companies.
“Our duty at SEC is to protect investors by ensuring only fit and proper professionals are allowed to provide financial services,” he told his audience.
The expert said investors should be extremely cautious, as various individuals may offer products and services using fake representations and promising high returns, such as Ponzi schemes.
A Ponzi scheme or game is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors. The scheme can go on as long as new investors are found, otherwise it collapses. Enditem