Capital market experts have advised Nigerians against investing in Ponzi schemes to avoid losing their hard earned money to fake capital and financial market operators in the country.
One of the experts, Akin Adeniyi, who is the President of the Association of Corporate and Individual Investment Advisers (CIIA), while speaking a webinar that reviewed the theme “Ponzi: Plugging the Ills of Unregistered Fund Managers in Nigeria,” said investors have lost over N300bn to these schemes across various platforms in the country.
Adeniyi explained that the proliferation of firms and funds that are unregistered with the Securities and Exchange Commission (SEC), aggressive advertising campaigns designed to extort people, and others are responsible for the surge in Ponzi schemes in Nigeria.
Mr. Adeniyi also outlined why Nigerians should invest with suitable capital market operators with a proven track record and market values.
On his part, Mr. Okey Umeano, Chief Economist, SEC Nigeria speaking on why people fall into the trap of Ponzi Schemes, said the major pull factor is the “Investors Greed”.
In her contribution, Toyin Kekere-Ekun, CEO of Lotus Financial Services Limited, called for increased awareness of the patterns and dangers of the Ponzi schemes in the Nigerian financial market, which will equip Nigerian investors with the knowledge and insight on detecting and avoiding them.