The crave for cheap money by Nigerians, especially the youths, is now making them victims of Ponzi schemes across the country, experts have said.
Even though people have fallen victims of previous Ponzi schemes, such as MMM, others, who are gingered by their addiction to cheap money, have again become victims of the recent CBEX Ponzi scheme where Nigerians are believed to have lost N1.3 trillion.
Trouble started on April 14, 2025, when customers couldn’t withdraw their money. Later, some of the furious customers ransacked a CBEX office in the Southwest city of Ibadan, Oyo State, carting off chairs, air-conditioners and solar panel.
CBEX had claimed to be a global platform linked to a government-owned business in China. However, Beijing Equity Exchange, in a statement released in 2024, denied any affiliation with the Ponzi scheme. It also claimed to operate offices in Canada and had ties with China. These were never substantiated; rather, CBEX displayed certificates online, such as a US FinCEN registration, while no real branches existed outside Nigeria.
Aside CBEX, in the past nine years, several Ponzi schemes have emerged, such as MMM Nigeria, Ultimate Cycler, NNN Nigeria, MMM Cooperation, Bitclub Advantage, Million Money, 86FB (aka 86Z), Eagle Cooperative, CALA (Cala Finance), 6Dollars Investment, among others. All of them have used similar tactics to defraud Nigerians, promising mouthwatering offers to lure the unsuspecting public.
Reacting to this development, a blockchain business coach, Daniel Akinyemi, told LEADERSHIP Sunday that CBEX had given all the necessary red flags but many Nigerians were enticed by the mouthwatering return on investments that it offered.
“The scammers understand what people want to hear, and they took advantage of the need for people to make more money,” he said.
Noting that what most people love to hear is that their funds can be doubled within a short period of time, Akinyemi urged that investors should ensure that their hard-earned funds are first secured in low-to-no risk investments before putting funds in high-risk investments.
“What many investors in Nigeria actually like to hear is that they can make 100 per cent within 30 to 45 days. Once most Nigerians hear that kind of statement, they are in and that was what CBEX leveraged on.
He explained that the scammers also leveraged on the fact that “crypto is very popular globally, and they know that people have this view about crypto, that people are making money, that was why they said they are trading crypto.
“Also, because they know that people are hearing about AI, they now said, they will handle the volatility of the crypto space by using the AI to trade with promises of outrageous returns, giving them a specific date, telling them they will be making an average of 1 or 2 percent on a daily basis. But the truth about the market itself is that it is not stable.
“In the case of CBEX, they promised people what does not really exist, they created a platform where they claim to be sending signals to people and they asked them to trade it. Now when people buy the assets, the CBEX asks them to buy, they are buying it inside the platform that CBEX has created. The admin had access to all the money of the people that put in their funds, when CBEX wanted to collapse, all they did from the back end was to move people’s money. That is not how crypto exchanges function.”
Acknowledging the harsh economic environment, he advised Nigerians to “calm down and value their capital knowing that the capital they are holding in their hand and in their bank account is extremely important. It is when that capital is saved that it can bring more for them. So, they should not put it in high-risk investments.
“The easiest way to spot some of the scam projects is that they will promise a certain amount of returns within a specific period of time. Any investment that comes and says you will make this x amount of money within this period of time is a Ponzi scheme because in crypto, there is no guarantee of any amount of money you can make.”
Following the event, the chief economist at SPM Professionals, Paul Alaje, had advocated investment-education, highlighting that Nigerians have lost about N4.8 trillion to pyramid scams since the collapse of MMM in 2016.
“Since MMM in 2016, Nigerians have lost approximately N4.8 trillion to pyramid scams. The pyramid scam is a scheme designed to rip you off of funds. It is only a pyramid scam that promises more interest than the IMF and World Bank put together in a month and sometimes in a week,” Alaje had said in an interview with a journalist.
Recently, the director-general of the Securities and Exchange Commission (SEC), Dr Emomotimi Agama, said the commission was launching a more forceful and coordinated enforcement regime against unregistered and illegal ‘phony’ investment schemes, otherwise known as Ponzi schemes.
He said, with the newly enacted Investments and Securities Act, 2025 (ISA 2025), the commission has enhanced powers to prosecute Ponzi schemes and their promoters.
