Experts call for inter-agency taskforce to address ponzi pitfalls in ISA
By Ginika Okoye
Some capital market experts have called on the Securities and Exchange Commission (SEC) to create an inter-agency digital surveillance taskforce to address ponzi schemes related gaps in the Investment and Securities Act (ISA, 2025).
The experts spoke at a webinar organised by the Institute of Capital Market Studies (ICMS) Nasarawa State University, Keffi (NSUK) in collaboration with the Capital Market Academics of Nigeria (CMAN) on Sunday.
Prof. Uche Uwaleke, the Director of ICMS, NSUK, said that although ISA 2025 represented a significant step forward in modernising the country’s capital market, critical regulatory blind spots remained.
Uwaleke said the taskforce should include agencies like SEC, the Economic and Financial Crimes Commission, the Nigerian Communications Commission and the National Information Technology Development Agency.
He also suggested the establishment of a public verification portal to enable citizens check and confirm genuine investment platforms before investing.
The director said fraudulent schemes springing up often used informal channels/social media like WhatsApp, Instagram or unregistered digital apps and were difficult to monitor.
Uwaleke said the inter-agency collaboration would help stop the activities of those fraudulent schemes in real time.
“Prohibited scheme which is mentioned in S. 192 (page 182) of ISA 2025 is defined under Miscellaneous provisions (page 305) to include ‘ponzi or pyramid schemes.’
“These provisions seem to focus on ponzi schemes with physical presence.
“Springing up today are fraudulent schemes that often use informal channels/social media (e.g WhatsApp, Instagram or unregistered digital apps) and are difficult to monitor or stop in real time.
“Despite the ISA’s stronger penalties, (liability of the promoters on conviction to a fine of not less than N20 million or imprisonment to a term of 10 years or both (S.192).
“Lack of proactive detection mechanisms means investors may still be defrauded before SEC can act,” he said.
Augustine Agom, Professor of Law from the Ahmadu Bello University Zaria, said investors’ protection was key in the ISA.
Agom said the law had enhanced regulatory sanctions.
He advised stakeholders and investors in the market to be careful of some sharp practices.
According to him, it is time for investors to come to the market.
Also analysing the ISA, 2025, Adesina Bello, a Professor of Law, said the capital market would be better if the ISA, 2025 was fully complied with.
Bello who spoke on Registration, Regulations and Financial Market Infrastructure, said the law would empower SEC to ensure that stakeholders adhered to the provisions of the law.
Aliyu Sanusi, Professor of Economics at the Ahmadu Bello University Zaria, said the recognition of non-interest financial instruments and project-specific bonds would open the market to broader investment classes.
Sanusi said the robust penalty regime of the ISA significantly raised the cost of mismanagement or abuse, protecting market integrity.
“Issuance preconditions (IGR ratios, debt service caps) will improve subnational and agency borrowing discipline,” he said.
The Director-General of SEC, Dr Emomotimi Agama, had said the law would help to create a dynamic, inclusive and resilient capital market for the economy.
The News Agency of Nigeria (NAN) reports that many stakeholders and experts in the market gave insights into the ISA, 2025. (NAN)(www.nannews.ng)
Edited by Chinyere Joel-Nwokeoma
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