Ponzi Scheme Operators in Nigeria are to face N10 million sanction, according to the newly enacted Investments and Securities Act.
Chairman, Investments and Securities Tribunal (IST), Amos Azi, disclosed this at the weekend during a stakeholders’ engagement meeting towards unveiling the Tribunal’s new e-filing platform, held in Abuja.
He noted that the repealed 2007 Act did not provide for such sanctions against Ponzi scheme operators.
“The former Act did not make specific provision as to the measures to be taken against Ponzi Scheme Operators. This new Act has now recognised a punitive penalty of not less than ten million naira and has also provided that if the account of the operator is frozen all expenses incurred in the course of investigating or freezing the account will also be deducted from that account, and the amount seized from the operator will be transferred to the Federation Account,” he said.
He emphasized that the new provisions in the Act are expected to serve as a deterrent and help tackle the menace of illegal investment operators within the capital market.
In addition to the sanctions, Azi highlighted other significant innovations introduced by the Act. These include the recognition of digital assets as securities, legal acknowledgment of cryptocurrency, and provisions for virtual service providers.
He explained that these additions allow for the establishment of virtual exchanges and broaden the Tribunal’s jurisdiction to adjudicate disputes arising in these areas—after passing through the complaint management framework.
Speaking on the on-boarding of the IST to the e-filing platform, Azi described it as a positive development that would enhance the investment climate in Nigeria. He stated that the initiative is poised to boost investor confidence and stimulate intentional capital investment in the country.
“It is an enhanced investor protection infrastructure that gives confidence to investors in the market. That look, we have this adjudicatory body that is time conscious, that will look at speedily within a specific period and resolve whatever dispute you have. Of course, that has the capacity and tendency to encourage investors, and stimulate investments in Nigeria,” he said.
However, Azi issued a note of caution, stating that once the e-filing system becomes fully operational, the physical filing of cases will no longer be allowed. He said the stakeholders’ meeting was convened to ensure that legal practitioners are adequately trained on the new system.
In an interview, the Chairman of the Nigerian Bar Association (NBA), Gwagwalada Branch, Owhor Clever, appealed to the Tribunal to extend training opportunities to NBA members to ensure seamless court proceedings under the new system.
The stakeholders’ engagement on e-filingand case management also featured online participation from Abuja, Port Harcourt, and Enugu State. The Investments and Securities Tribunal is expected to go live with the e-filing platform, barring any changes, in July 2025.
