Nigeria’s Securities and Exchange Commission (SEC) has proposed stringent measures to safeguard citizens from illicit financial schemes. The proposed Investments and Securities Bill (ISB) 2024, currently under review by the National Assembly, seeks to impose a N20 million fine and imprisonment of up to 10 years for operators of Ponzi schemes ¹. This move aims to fortify the nation’s financial landscape and shield investors from fraudulent activities.
The bill also prohibits pyramid schemes and other unauthorized investment platforms. Although the Ninth National Assembly passed the Investment and Securities Bill, which included provisions for jail terms for promoting Ponzi schemes, it wasn’t signed into law by former President Muhammadu Buhari.
In the revised bill, offenders will face penalties of at least N20 million or 10-year imprisonment, or both, upon conviction. Senator Godswill Akpabio, President of the Senate, emphasized the bill’s significance in modernizing Nigeria’s financial markets, fostering transparency, and boosting investor confidence.
Key Provisions of the Bill:
- Enhanced Investor Protection: Compensation for investors who suffer financial losses due to revoked or canceled registration of dealing member firms.
- Regulation of Commodity Exchanges and Warehouse Receipts: Development of the commodities ecosystem.
- Strengthened Legal Framework: Conforming to evolving societal and global realities.
According to SEC Director-General, Dr. Emomotimi Agama, a well-developed capital market is crucial for Nigeria’s economic transformation. The passage of the Investments and Securities Bill 2024 will be a pivotal step towards achieving a world-class capital market, facilitating economic diversification, and propelling Nigeria towards economic resilience and prosperity ¹.
