The Securities and Exchange Commission (SEC) has warned Nigerians against investing in illegal online investment schemes being promoted on social media platforms, saying many of them operate like Ponzi schemes and could lead to heavy financial losses for unsuspecting investors.
In a public notice issued on Thursday, the commission said it had observed a growing trend of unregistered online investment platforms using social media applications and websites to attract members of the public.
According to the SEC, the schemes are being promoted through platforms such as WhatsApp, Instagram, Telegram, Facebook, TikTok and other digital channels.
The commission stated that many of the operators behind these platforms are not registered to provide investment services in Nigeria and are illegally soliciting funds from the public.
It warned that several of the schemes display features commonly associated with Ponzi operations and prohibited investment activities.
“Many of these investment schemes exhibit characteristics of Ponzi or prohibited investment schemes, while some operators of such schemes also provide unauthorized investment services to members of the public,” the commission stated.
The SEC advised Nigerians to avoid any investment platform that promises unrealistic or guaranteed returns, noting that such offers are often used to lure people into fraudulent schemes.
“Accordingly, the Commission hereby advises the public to refrain from investing or participating in any unregistered online investment platform or scheme promising unrealistic or guaranteed returns,” the notice added.
The commission also cautioned members of the public against relying on investment advice shared online by individuals or organisations that are not registered with the SEC.
According to the commission, many fraudulent operators now use social media to circulate misleading investment information and attract unsuspecting victims.
“Members of the public are further advised not to rely on investment advisories circulated through online platforms by persons or entities not registered by the Commission, as reliance on such advisories may expose investors to significant financial losses and fraudulent schemes,” the SEC said.
The commission reminded Nigerians that under the Investments and Securities Act 2025, only companies and entities registered by the SEC are legally permitted to provide investment advisory services, promote investment opportunities or raise funds from the public within the Nigerian capital market.
The SEC therefore urged prospective investors to always verify the registration status of any company, platform or individual offering investment opportunities before committing their money.
It directed members of the public to confirm the status of investment operators through the SEC Fintech Registered Operators Portal and the SEC Capital Market Operators Portal before carrying out transactions with any investment platform.
The commission said verifying registration details before investing remains one of the safest ways for Nigerians to protect themselves from online fraud and illegal investment schemes.
