Ponzi Schemes Are Pure Greed -VC
The Securities and Exchange Commission (SEC) has taken its fight against fraudulent investment schemes to Ajayi Crowther University (ACU), Oyo, warning students to steer clear of get-rich-quick traps that have left millions of Nigerians financially devastated.
Speaking at a sensitisation programme held on the university campus, the Vice-Chancellor, Prof. Ebunoluwa Oduwole, said that anyone involved in Ponzi schemes is driven by pure greed.
The Vice-Chancellor during her address made a startling confession of how she had nearly fallen victim to multiple Ponzi schemes herself in the past.
“What others do and get away with, some will not,” she told the gathering of students and faculty members, describing the mindset that drives people into such investments as “Ojukokoro,” a Yoruba term for greed. She urged students to resist the temptation of easy money.
“Some people learn from experience, while some rise from falling. Hold firmly to whatever the experts will tell you today,” she admonished the students present at the event.
Delivering a presentation titled “The Dangers of Ponzi Schemes,” the Divisional Head of Operations at SEC’s Lagos Zonal Office, Mr. Taiwo Odusanya, broke down the mechanics of the fraud in simple terms.
“Simply put, Ponzi schemes employ the principle of robbing Peter to pay Paul,” he explained.
Named after Charles Ponzi, an Italian immigrant who operated a notorious fraudulent scheme in the United States between 1919 and 1920, these schemes require a constant influx of new investors to pay returns to earlier ones. They offer high returns with little or no risk, provide fake or incomplete documents, and never make legitimate investments sufficient to sustain promised payouts.
Odusanya warned that Ponzi schemes can be disguised as investments in agriculture, transportation and haulage, Bitcoin and other cryptocurrencies, or even gold coins and precious stones.
He said that promoters of such schemes lure the public through social media platforms like YouTube, radio programmes, public workshops, fliers, billboards, celebrity influencers, and unregulated online crypto platforms.
Mr. Odusanya further outlined the severe consequences of participating in such schemes, including large-scale financial losses, diversion of savings into unproductive enterprises, reduction of deposits in commercial banks, and an increase in non-performing loans when bank funds are invested in fraudulent schemes.
He added that Ponzi schemes undermine confidence in financial markets and regulators and can lead to the diversion of funds from the local economy to foreign destinations when promoters operate online from overseas.
To avoid becoming a victim, he advised students to conduct thorough due diligence via the commission’s dedicated website, be skeptical of get-rich-quick promises, never part with their money if unsure, and always enquire from regulators. He, however, charged them to report suspected Ponzi schemes to the right authorities.
Mr. Odusanya disclosed that the Commission has intensified investor education through print media campaigns, radio jingles, school outreach programmes, short drama clips, and webinars. He added that SEC is collaborating with the Nigeria Police Force (NPF), the Economic and Financial Crimes Commission (EFCC), and the Office of the Attorney General of the Federation for criminal investigation and prosecution.
He concluded by saying that promoters of unauthorized schemes now face up to 10 years’ imprisonment, monetary fines, and asset forfeiture under the Investment and Securities Act (ISA) 2025.
The event also had in attendance the Deputy Vice-Chancellor (Academic), Prof. Afolake Olanbiwonninu; the Deputy Vice-Chancellor (Administration), Prof. Olukayode Binuyo; the University Librarian, Dr. Bosede Ajiboye; the Dean of the Faculty of Management Sciences, Prof. Ezekiel Adeleye; and the Head of the Department of Business Administration, Prof. Odunlami Ibojo, along with Mrs. Kelechi Azubuike-Luke from SEC.
As a side attraction, students were treated to a short play dramatising how Ponzi schemes operate and defraud unsuspecting victims, a performance that drew both laughter and sober reflection from the audience.