SEC Warns Nigerians Against Investing in 6 Companies, Mentions Their Names

• The SEC has asked Nigerians to be careful about various unregistered firms seeking investments
• The commission warned that the firms are not licensed in Nigeria, and the government does not approve of their activities
• The regulator urged investors to verify firms' registration status and warned that those investing in unlicensed entities do so at their own risk

Legit.ng journalist Dave Ibemere has over a decade of experience in business journalism, with in-depth knowledge of the Nigerian economy, stocks, and general market trends.

The Securities and Exchange Commission (SEC) has cautioned the public against investing in six unregistered firms, warning that the companies are operating in violation of capital market regulations.

The commission, in different circulars, shared critical red flags Nigerians should watch out for from the illegitimate investment platforms that prey on unsuspecting Nigerians.

Identifying the red flags

SEC warns that investment scams often promise unrealistic returns in a short period, leveraging high-pressure tactics to push hurried decisions.

It said such schemes, including Ponzi and pyramid structures, capitalise on enticing narratives but ultimately lead to significant financial losses.

SEC's warning to Nigerians

In response to these fraudulent activities, the SEC stressed the need for due diligence and verification before investing.

Here is the list of platforms the SEC wants Nigerians to avoid:

CMTrading

SEC recently flagged CMTrading, an online platform falsely claiming to operate under licenses from the Financial Sector Conduct Authority of South Africa and the Financial Services Authority of Seychelles.

The platform uses cloned websites and social media posts featuring prominent Nigerians to lure victims into what the SEC identifies as a Ponzi scheme.

Sapphire Scents Limited

Sapphire Scents Limited, posing as an Investment Adviser/Fund Manager without SEC registration, promotes unregistered investment schemes. SEC warns against engaging with Sapphire Scents Limited, emphasising the importance of verifying companies' statuses before investing.

ZugaCoin and Samzuga GPT

Promoted as meme coins without tangible projects or SEC approval, ZugaCoin and Samzuga GPT highlight the risks associated with speculative investments.

SEC cautions the public against participating in their purchase or promotion due to potential pump-and-dump schemes.

Punisher Coin ($PUN)

Similarly, the SEC alerted against the unauthorised presale of Punisher Coin ($PUN), categorising it as another meme coin lacking intrinsic value or SEC approval. Investors are urged to refrain from engaging in this scheme.

TOFRO.COM

Another unregistered online investment platform is TOFRO.COM, operated by ToFro Exchange Global Professional Station.

The commission stated that the platform has traits indicative of a fraudulent Ponzi scheme.

CBEX (Crypto Bridge Exchange)

Operating under false legitimacy claims, CBEX (Crypto Bridge Exchange) solicited investments with unrealistic returns, only to abscond with substantial investor funds, estimated at over N1.3 trillion.

SEC noted CBEX was never registered to operate as a Digital Assets Exchange in Nigeria and urges affected investors to report complaints.

NNPCL warns investors against scammers

Earlier, Legit.ng reported that the Nigerian National Petroleum Company Limited issued a warning about scammers posing as the company, targeting foreign businesses and investors.

The warning, issued by NNPCL's chief corporate communications officer, Mr. Olufemi Soneye, urged the public to be cautious and report any fraudulent activities.

NNPCL emphasised that all legitimate engagements occur strictly through official channels and business units associated with the company.

Proofreading by James Ojo, copy editor at Legit.ng.

Source: Legit.ng