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SEC raises awareness over fake Ponzi Scheme
FRIDAY EKEOBA
The Securities and Exchange Comission (SEC) has warned the investing public about a ponzi scheme aimed at defrauding them of their money by offering them a higher interest commission on investment.
The Commission in a notice on Wednesday signed by the management, said its attention has been drawn to the activities of an Illegal Operator (Converged Dynamic International Limited, noting that the Company embarked on a product tagged “Resources Investment Account” which offers interest rates on a short and medium term period to lure the investing public.
According to the Commission the investing public is warned that the operation of this investment scheme is not registered by SEC and has no tangible business model hence it’s a ponzi scheme where returns are paid from other people’s invested sum.
“The general public is hereby advised to desist from investing in products marketed by the Company. Please note that anyone that subscribe to this illegal activity does so at his/her own risk”, it added.
The commission only recently, raised the alarm over the activities of some online fraudsters, who are currently running an online investment scheme tagged ‘MMM Federal Republic of Nigeria’.
The fraudsters, according to SEC, carry out their illegitimate business via Nigeria.mmm.net portal/platform, and are promising investors a monthly investment return of 30 per cent.
SEC said the venture had no tangible business model, describing it as a Ponzi scheme, where returns would be paid from other people’s invested funds.
Investopedia.com describes a Ponzi scheme as a fraudulent investing scam promising high rates of return with little risk to investors. The scheme generates returns for older investors by acquiring new investors.
In a related development, SEC said its attention had been drawn to the activities of one Mrs. Oge C. Ottiwu of No. 118 Zink Avenue, Opposite Eke Market, Awka, Anambra State, allegedly engaging in capital market activities without any registration within Anambra State and its environs.
“Section 38(1) of the Investments and Securities Act, 2007 requires any person who intends to operate as a professional in the capital market or carry on securities business to be registered by the commission before engaging in such activities. It is therefore illegal to carry on any kind of capital market business without registration,” it said in a post on its website.
