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Nigeria’s finance intelligence and security join forces to tackle ponzi schemes

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The Securities and Exchange Commission (SEC) has signed a Memorandum of Understanding (MoU) with the Nigerian Financial Intelligence Unit (NFIU) to combat ponzi schemes and fraud in the capital market.

While speaking in Abuja on Wednesday, 17 July 2019, Mary Uduk, the Acting Director-General of SEC, said that the collaboration was necessitated by the need for SEC and NFIU to close ranks in the face of “insider dealings, reawakening of Ponzi schemes, cybercrime and other fraudulent activities that have engulfed the market in the last few years”.

Uduk said the commission was paying close attention to digital transactions and was in the process of amending its laws to capture such activities.

According to her, SEC already has regulations prohibiting shell companies from operating in the capital market.

She stated that under the collaboration, NFIU would assist the commission in tracking suspicious transactions as they occur.

The MoU, she said, covers training, secondment of middle cadre officers between the organisations, cross-border monitoring, repatriation of stolen funds from the capital market and prosecution of offenders, among others.

On the rising incidence of Ponzi schemes in the country, Uduk stressed the need for more public sensitisation to ensure that unsuspecting Nigerians do not continue to lose their hard-earned money.

In his remarks, Modibbo Tukur, the Director of NFIU, assured SEC that the agency would continue to play its part in ensuring that the financial system was safe for Nigerians to operate.

He disclosed that NFIU was making efforts to ensure that the financial system was rid of shell companies, adding that, for companies to exist, they should have physical addresses.

“If anyone establishes a company, it has to be a company indeed and we have to be firm on this.

“This has become more important now given the roll out of the Economic Community of West Africa States (ECOWAS) single currency, because with that, we know that capital and investments will move across borders and it is a single currency.

“So, we have to step up regulation to avoid fraudulent transactions. We will begin by September and some companies will have to be deregistered if they do not meet the criteria, he said.

He commended SEC on its regulation barring shell companies from operating in the capital market.



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