CMC: Yuguda highlights Ponzi schemes’ risk to capital market devt

…As unclaimed dividend hits N171bn

The Securities and Exchange Commission (SEC) has described the activities of Ponzi schemes as cancer that is capable of undermining the growth and development of Nigeria’s Capital Market.

SEC Director General Lamido Yuguda said this during a Post Capital Market Committee meeting press briefing in Abuja.

Yuguda insisted that the situation was unacceptable especially with the kind of loss unsuspecting investors continue to suffer.

Further describing its effort to tackle Ponzi schemes activities as ‘fighting a serious war’, the SEC DG said it has done a lot of sensitisation to discourage people from falling victims of the fraudsters.

“Unfortunately, a lot of people still go to these people. It is not difficult to recognize a Ponzi scheme. Some are aware that the offers are too good to be true.

People need to understand how anponzi scheme works. When the Return on Investment that you are being offered is way higher than the normal business will give you.

He urged potential investors to seek clarification from the Commission if they have any doubt about any business they were going into urging Nigerians to ‘only deal with registered operators  with the Commission.

“It is depriving lot of households of money that should be used for meaningful endeavours.”

The SEC helmsman said the Commission has been collaborating with the NFIU, the EFCC, as well as non-governmental organisations to tackle the menace of Ponzi schemes to Nigerians.

He disclosed that the Commission is in discussion with the Lagos State government to setup billboards in the State to warn citizens about the dangers of Ponzi schemes.

On the unclaimed dividends, the SEC boss said unclaimed dividends as at the end of 2021 was N177 billion moving from N168 billion in 2020.

In spite of various effort to ensure investors claim their dividends many have still not been able to explaining that the Commission will continue to work with registrars to ensure dividends are disbursed electronically.

“People will still need to go to the registrars to provide information of their account so that they can be credited directly.”

He admitted that there is need for increased enlightenment of investors.

The two-day meeting was attended by over 300 capital market operators.

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