SEC issues warning about unregistered investment schemes in Nigeria

The Securities and Exchange Commission (SEC) has issued a warning to investors regarding various unregistered investment schemes like Pro-Vest and My Share, highlighting the risks of fraud and financial losses associated with these entities. In separate notices, the commission specifically called out Promiseland Estates Limited, Promiseland Building & Construction Limited, and UYJ Multitrade Limited for operating illegally in the Nigerian capital market.

According to SEC, individuals should be cautious and avoid engaging with Promiseland Estates Limited, Promiseland Building & Construction Limited, or their representatives in any business related to the Nigerian capital market as they are not registered to operate in any capacity within the market. Similarly, My Share, which is linked to UYJ Multitrade Limited, has been identified as not authorized to act as an investment adviser or fund manager by the commission.

Transacting with unregistered and unregulated entities in the capital market can expose investors to potential fraud and the risk of losing their investments. Therefore, the commission urged the public to verify the registration status of any firm offering investment opportunities through its online portal to safeguard their investments. By confirming the status of companies and entities offering investment opportunities on the Commission’s dedicated portal, investors can protect themselves from fraudulent schemes and illicit operators.

In recent years, Nigeria’s investment market has faced challenges due to fraudulent schemes, with regulators consistently issuing warnings about illicit operators. Notably, the collapse of the MMM Ponzi scheme in 2016 led to significant financial losses for many Nigerians. Similar fraudulent schemes like Loom, MBA Forex, and Chinmark have also defrauded investors, emphasizing the ongoing risks posed by unregulated entities in the market.

As a result, investors are advised to exercise caution and conduct due diligence before engaging with any investment opportunities. By heeding the warnings issued by regulatory authorities like SEC, individuals can protect their hard-earned money from potential fraud and financial scams prevalent in the Nigerian capital market. It is crucial for investors to be vigilant and verify the legitimacy of investment firms and entities before making any financial decisions to safeguard their interests and prevent falling victim to fraudulent schemes.