Promoters and operators of Ponzi schemes in Nigeria now face stricter penalties, including a minimum fine of ₦20 million, at least 10 years in prison, or both, under the newly enacted Investments and Securities Act (ISA) 2025.
The Securities and Exchange Commission (SEC) announced the new law on Monday, emphasizing its goal to strengthen investor protection, enhance market integrity, and curb fraudulent investment schemes that have defrauded many Nigerians.
Tougher Enforcement Powers for SEC
SEC Director-General Emomotimi Agama highlighted that before the ISA 2025, the commission lacked the legal authority to prosecute Ponzi scheme operators effectively. Now, the new law introduces “disgorgement”, which requires convicted individuals to return all illicit profits gained from fraudulent activities.
Beyond the ₦20 million fine, additional penalties—such as financial restitution to victims—will be enforced to ensure fraudsters are fully held accountable.
SEC Gains Power to Access Phone Records
The ISA 2025 also grants SEC expanded investigative powers, including the ability to access and review telephone records and other digital communications. This will help track down Ponzi scheme operators and gather critical evidence against them.
Agama stressed that these measures are designed not just to punish offenders but to deter fraudulent investment activities.
“Protecting investors is a core responsibility of the SEC, and this law strengthens our ability to fulfil that duty. With these new powers, we can track down individuals defrauding Nigerians and bring them to justice,” he said.
With these tougher penalties and enhanced enforcement powers, the Nigerian government hopes to curb the rising cases of Ponzi schemes and protect citizens from financial scams.
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