CBEX, Yet Another Ponzi Scheme Scam

Once again, Nigeria is grappling with the devastating aftermath of another Ponzi scheme collapse. This time, the culprit is Crypto Bridge Exchange (CBEX) – a digital asset platform that enticed hundreds of thousands of Nigerians with promises of extraordinary returns, claiming up to 100 per cent profit in just 30 days. As with many fraudulent schemes before it, CBEX vanished overnight, reportedly absconding with more than N1.4 trillion in investor funds. It is now being described as the largest Ponzi scheme heist in Nigerian history.

The pattern is all too familiar. CBEX, operated by ST Technologies International Limited, projected an image of legitimacy. It was registered with the Corporate Affairs Commission (CAC) and listed under the Economic and Financial Crimes Commission’s (EFCC) Special Control Unit Against Money Laundering. However, it failed to obtain a licence from the Securities and Exchange Commission (SEC), operating in blatant violation of Nigerian financial regulations. Despite a warning issued by Hong Kong authorities as early as April 2024, Nigerian regulators failed to respond swiftly, allowing the scheme to thrive until its inevitable collapse.

CBEX is only the latest in a long list of such scams. From MMM Nigeria in 2016, to MBA Forex in 2020, and Chinmark in 2022, Ponzi schemes have continued to exploit vulnerable Nigerians. Since 2016, Nigerians have lost an estimated N1.7 trillion to these scams, though the Nigeria Deposit Insurance Corporation (NDIC) estimates the losses to exceed N2 trillion over the past decade.

One might expect that the painful lessons of the MMM scandal, which defrauded about three million Nigerians, would deter future participation in such schemes. However, widespread poverty, inflation, and unemployment have left many desperate – and sometimes dangerously hopeful. While some victims were misled, many knowingly engaged in high-risk schemes, believing they could outsmart the system by joining early and exiting with profit before the inevitable collapse. This mindset, often reinforced by social media testimonials, peer pressure, and influencer endorsements, has turned the country into fertile ground for fraudulent investment platforms.

Ponzi schemes thrive on economic hardship and human hope – but hope itself is not a crime. The greater failure lies with institutions consistently failing to protect the public. Despite sporadic advisories from the SEC and the profiling of suspicious platforms by the EFCC, enforcement remains largely reactive. Investigations are typically launched only after platforms have imploded and the perpetrators have disappeared.

The recently signed Investment and Securities Act (ISA) 2025, introduced by President Bola Tinubu, offers a glimmer of hope. It criminalises the operation and promotion of Ponzi schemes, with penalties of up to 10 years’ imprisonment. However, legislation alone is not enough. Enforcement must be timely and decisive. In the case of CBEX, credible warnings emerged months before the crash – yet no action was taken.

Even now, with the SEC and EFCC pledging to pursue CBEX’s operators and recover stolen funds, public confidence remains low. Previous victims of MBA Forex, Chinmark, and Baraza are still awaiting justice. If the authorities promise recovery, they must follow through.

However, stronger laws and enforcement measures alone will not solve the problem. The more fundamental battle lies in reshaping the mindset of the average Nigerian investor. Many Nigerians still struggle to distinguish between legitimate investment opportunities and sophisticated scams. This financial ignorance must be addressed as a national priority.

That is why we insist that the N10 billion recently approved by the Senate for investor education be deployed transparently and efficiently. Awareness campaigns must be widespread and relatable, targeting schools, religious institutions, marketplaces, motor parks, and digital platforms. Financial literacy is now a must for the public.

Moreover, those who knowingly promote Ponzi schemes – whether social media influencers, celebrities, or religious leaders – must be held liable and accountable. Individuals who endorse fraudulent platforms in exchange for commissions should face legal or, at the very least, public consequences.

The human toll of these schemes cannot be ignored. The aftermath of CBEX’s collapse has seen reports of hospitalisations, mental health breakdowns, and even suicides. These are not merely “greedy investors” – they are parents, retirees, students, and job seekers, many of whom staked borrowed or stolen funds in pursuit of financial security.

Ultimately, Nigeria must confront a deeper cultural issue: the glorification of wealth without scrutiny of its source. Regulators and law enforcement must use the CBEX collapse as a turning point – an opportunity to break the cycle of greed, ignorance, and inaction.

As a newspaper, we urge Nigerians to be vigilant. If an investment promises unrealistically high and guaranteed returns, encourages reinvestment and recruitment, lacks transparency, is promoted by unknown or unregistered entities, and offers no clear business model or risk disclosure, it is most likely a scam.

Finally, the EFCC and SEC have pledged to recover lost funds and bring the perpetrators to justice. We urge them to keep that promise, no matter how long it takes. That would serve as a deterrent to such scammers who target already hard-pressed Nigerians.