Nigerians have lost N4.8 trillion ($2.99 billion) to various scams since 2016, according to findings by Paul Alaje, a prominent Nigerian economist and chief economist at SPM Professionals.
This is coming on the heels of the recent crash of Crypto Bridge Exchange (CBEX), a digital asset company, where over 600,000 investors lost N1.3 trillion.
With the collapse of CBEX, Alaje said that accounting for the depreciation of the naira, the actual figure is close to N8 trillion ($5 billion) since 2016.
CBEX, like all Ponzis and scams, was an investment fraud that pays existing investors with funds collected from new investors.
CBEX lured investors with promises of a 100% return on investment after 30 days.
Consistent with other scams, the early investors received the promised returns, attracting thousands more into what they thought was a legitimate platform.
Following the platform’s collapse, the Economic and Financial Crimes Commission (EFCC) has arrested two suspects believed to be among the operators.
A source from the economic crimes watchdog told a local outlet that five others, including two Nigerian siblings and a British citizen, are under probe for their involvement.
The EFCC is investigating who funded the firm, how it managed to evade regulatory scrutiny, and its legacy financial partners.
Emomotimi Agama, director general, Securities and Exchange Commission (SEC) said that CBEX wasn’t registered, limiting the agency’s ability to crack down on the company.
“The first responsibility of the SEC is to watch over regulated institutions within the confines of its available resources. Registration actually is the hallmark of regulation. Without registration, the possibility of regulation becomes difficult,”.
Agama further noted that no member of the public had made any reports regarding CBEX before it blew up, despite the company operating for nine months.
