The Securities and Exchange Commission (SEC) has, in a bid to clamp down on unregistered investment platforms and curb the growing menace of Ponzi schemes in Nigeria, introduced a USSD code system that will allow citizens to verify the legitimacy of capital market operators using their mobile phones.
This development was disclosed by the SEC Director-General, Dr. Emomotimi Agama, during an interview in Abuja over the weekend.
He explained that the innovation is part of wider reforms to sanitise Nigeria’s capital market and protect unsuspecting citizens from falling prey to fraudulent schemes.
“We are introducing the code system that will allow mobile phone users to verify a capital market operator using USSD codes. They do not require an internet connection to be able to do this,” Agama said.
“If anyone comes to you claiming what they are not, all you need to do is check the code to know the status of their registration. That will be launched at the next Capital Market Committee Meeting.”
The SEC boss stated that the Commission is stepping up regulatory measures and public education to encourage legitimate investment while dismantling shady operations that masquerade as financial opportunities.
“The essence of regulation for us at the SEC is wealth redistribution,” Agama said.
“We sensitise people that they can make money through legitimate processes like public offerings, Collective Investment Schemes, and other structured products that are regulated and monitored.”
He further disclosed that the SEC is collaborating with the Nigerian Educational Research and Development Council to infuse capital market education into the school curriculum and is working with consultants to introduce financial literacy through educational games.
CAC Registration Not Enough – SEC Warns
Agama warned that mere registration with the Corporate Affairs Commission (CAC) does not confer authority to operate as an investment firm.
He stated that, “The first thing you ask anyone that comes to speak to you on money matters, ask them about their registration with the SEC.
“We have stockbrokers, registered accountants, solicitors, and sponsored individuals who are qualified and approved to offer investment advice.
“Registration with CAC alone does not give anyone the license to operate investment services.”
New Law Imposes Heavy Sanctions On Ponzi Promoters
The SEC Director-General also cited the recently signed Investment and Securities Act (ISA) 2025, which introduced stiffer penalties against operators and promoters of Ponzi schemes, now officially classified under the term “prohibited schemes.”
“You can see the passion of the President in swiftly signing the Act; he did it in record time within one week. That is because he is particular about the welfare of Nigerians,” Agama stated.
“In that Act, if anyone is caught, they are to pay ₦20 million in the first instance, and it can go up to ₦1 billion. They are also to face up to 10 years imprisonment.”
He said the new law grants the SEC the authority to also prosecute celebrities and influencers who use their platforms to promote Ponzi schemes to unsuspecting followers.
“We now have power to deal with influencers and celebrities that bring these up in the air and promote these Ponzi scheme operators,” Agama warned.
“The SEC is leaving no stone unturned.”
Agama reiterated the Commission’s warning for Nigerians to avoid unregistered or unregulated investment schemes, especially those promising exaggerated or guaranteed returns.
“These schemes are not registered with the SEC and do not offer investor protection under the law,” he stressed.
He urged investors to verify any investment firm’s registration status by visiting the SEC’s official website or contacting the commission directly.
“We remain committed to our mandate of protecting investors, ensuring fair practices, and maintaining confidence in Nigeria’s capital market,” he said.