From Juliana Taiwo-Obalonye, Abuja
The Nigerian Financial Intelligence Unit (NFIU) has released a comprehensive advisory alerting Nigerians to the escalating threat of Ponzi schemes and unregulated crowdfunding operations, particularly those exploiting digital assets, agriculture and real estate sectors.
In the advisory published on Wednesday, the NFIU emphasised that these fraudulent schemes have evolved in sophistication, often masquerading under enticing brand names promising unrealistically high returns within short periods. The surge in such schemes between 2022 and 2025 has disproportionately targeted vulnerable Nigerians facing financial hardships, who are lured by the promise of quick profits despite regulatory warnings.
The most prevalent form of Ponzi schemes now involves digital assets such as cryptocurrencies and tokens. These schemes exploit the anonymity, ease of transfer, and limited regulation of digital currencies. The NFIU highlighted notorious cases including Crypto Bridge Exchange (CBEX), Chinmark Group, MBA Forex, and others, which used fake tokens and referral-based models to defraud investors of billions of naira.
CBEX, for example, promised a staggering 100 per cent return on investment in just 30 days but collapsed after reportedly defrauding investors of over ₦1.3 trillion. The scheme used complex blockchain techniques to obscure fund flows, making recovery difficult. Chinmark Group, operating under the guise of a legitimate conglomerate with interests in real estate, logistics, and healthcare, used social media influencers and religious narratives to build trust, only to later default on promised returns exceeding ₦10 billion in losses to investors.
According to the NFIU, these schemes often feature red flags such as unrealistic guaranteed returns, lack of regulatory licensing, heavy reliance on referrals, opaque business models, and use of fake partnerships or endorsements. They also tend to operate primarily through social media and messaging apps, making regulatory oversight challenging.
Agriculture-related Ponzi schemes have become widespread since 2022, with companies promising exceptionally high returns on investments in farming ventures that are not sustainable. The NFIU cited cases involving firms like Farmforte Ltd, Green Eagles Agribusiness, and others, which used elaborate but vague business models and pressured investors to recruit others to maintain payouts. One notable case involved a Lagos-based operator who processed over N400 million in suspicious transactions, promising monthly returns of 16% before collapsing.
The newly enacted Investment and Securities Act (ISA) 2025 strengthens the legal framework against Ponzi schemes by criminalizing their promotion, with penalties including fines of at least N20 million and up to 10 years imprisonment. The Securities and Exchange Commission (SEC) has been empowered to regulate digital assets and collective investment schemes, aiming to close loopholes exploited by fraudsters.
The NFIU urged regulatory authorities to enforce licensing for Virtual Asset Service Providers (VASPs), adopt advanced fraud detection technologies, enhance public awareness campaigns, and establish investor protection funds. Financial institutions and reporting entities were reminded to strengthen Know-Your-Customer (KYC) and Anti-Money Laundering (AML) compliance, monitor transactions vigilantly, and report suspicious activities promptly.
In a statement, the NFIU said, “We are committed to saving Nigerians from the troubles associated with Ponzi schemes. Our intelligence efforts are ongoing, and we will ensure that major actors and collaborators are brought to justice. Reporting entities must file Suspicious Transaction Reports without delay to aid in the fight against financial fraud”.
The agency also advised the public to verify the registration status of investment platforms with the SEC, ask critical questions about how returns are generated, beware of too-good-to-be-true promises, and report suspicious schemes to authorities immediately.
Financial experts warn that greed and the desire for quick returns continue to fuel the proliferation of Ponzi schemes. As one analyst put it, “Everyone who has become a victim of a Ponzi scheme is driven by greed. While the economy is tough, investors must seek verifiable investment products and exercise caution”.
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