Ponzi Scheme: Court Jails Famzhi Boss For 5 Years

In a significant boost to the enforcement activities of the Securities and Exchange Commission (SEC), a Federal High Court in Abuja has convicted and sentenced the chairman of Famzhi Interbiz Limited, Mariam Suleiman, to five years imprisonment for defrauding investors of over N2 billion.

The trial judge, Justice Inyang Ekwo handed down the verdict after he found Suleiman and her company guilty of the two court charges brought against them by the federal government.

The judge held in his judgement, “Upon the provisions of Section 516 of the Criminal Code Act and Section 56(6) of the Securities and Investment Act being read to the defendants, for understanding of the terms of punishment therein.

“And upon hearing the allocations of the learned counsel for the defendants and considering the same, I am minded not to impose the full punishment on the first defendant (Suleiman) particularly,” he said.

Justice Ekwo, consequently, sentenced Suleiman to three years imprisonment on count one and two years imprisonment on count two, which would run concurrently from the date of the order.

He equally ordered the company to be wound up and all its property forfeited to the federal government.

“The said property shall be sold, and the proceeds used to compensate the victims of this crime,” he declared.

The SEC had three years ago disclaimed the activities of Famzhi Interbiz Limited, warning that neither the entity nor the ‘illegal products’ they offer were registered or regulated by the Commission.

The SEC stated that despite not being registered by the Commission, the company had proceeded to unlawfully solicit funds from the investing public on the product(s) neither registered nor approved by the Commission, with the promise of a guaranteed return on investment in clear violation of the Securities and Investment Act (ISA) 2007.

Consequently, the Commission stated that it had referred the company to the appropriate law enforcement agency for criminal investigation and possible prosecution for violation of the provisions of the Investments and Securities Act 2007 and other relevant laws in Nigeria.

Earlier in the judgment, Justice Ekwo said it was clear that the 1st and 2nd defendants conspired anthems with them and did an illegal act.

“That is, to lure and offer for subscription an unregistered investment collective scheme valued over N2 billion to the unsuspecting general public.

“On that note, I found that the conspiracy offence in count one is proved as required by law,and I sold it.”

Justice Ekwo also held that by the evidence of the prosecution witnesses and the exhibits tendered, it was established that the defendants “ran a scheme in pursuance of which members of the public were invited or permitted to invest money in a portfolio for a participatory interest.

“The defendants never disputed this evidence. The position of the law as settled in many authorities is that evidence adduced in court, relevant to the issue in controversy neither being challenged nor successfully debunked becomes good and credible evidence, which ought to be relied upon by a trial judge.”

The court further held that it was also pertinent to note that the MD admitted both in her evidence-in-chief and during cross-examination of running the scheme.