Onome Amuge
A growing wave of investment scams and crypto-related fraud is prompting closer coordination between market regulators and law enforcement, as authorities seek to protect household savings and preserve confidence in the formal financial system.
The Securities and Exchange Commission (SEC) and the Nigeria Police Force (NPF) this week agreed to deepen cooperation aimed at combating illegal investment schemes, unregistered market operators and fraudulent cryptocurrency offerings. The move reflects growing concern within the government that financial crime, particularly those dressed up as high-yield digital investments, is undermining trust at a time when Nigeria is seeking to mobilise domestic capital for economic recovery.
At a meeting in Abuja with Kayode Egbetokun, the inspector general of police, Emomotimi Agama, SEC’s director-general, described the challenge as one that goes beyond regulatory compliance and into the realm of social stability. While the SEC is mandated to oversee capital markets, license operators and police market conduct, he said, criminals operating outside the regulatory perimeter have been able to exploit weak coordination between detection and prosecution.
“These actors operate in the shadows,” Agama told the police leadership, referring to promoters of unregistered schemes promising extraordinary returns, often marketed as cryptocurrency or foreign exchange trading opportunities. Such schemes, he said, prey on financially vulnerable Nigerians and have left behind “shattered lives, depleted pensions and broken trust”.
The scale of the problem has increased alongside Nigeria’s expanding retail investor base and the growing popularity of digital assets. Although cryptocurrencies remain largely unregulated in Nigeria, they are widely traded, particularly among younger Nigerians seeking protection against inflation and currency volatility. This has provided fertile ground for fraudsters offering implausibly high and fast returns, often through social media platforms and messaging apps
The regulator is also seeking to deepen cooperation with the police cybercrime and cybersecurity units, reflecting the increasingly digital nature of investment fraud. Many schemes now operate primarily through social media platforms, messaging apps and cloned websites, allowing perpetrators to reach thousands of victims quickly and disappear just as fast.
Agama said the objective was to create a rapid-response capability that could identify emerging schemes early, trace fund flows and pursue criminal prosecution alongside regulatory sanctions. Capacity building and knowledge transfer between both institutions would be central to the arrangement, particularly in areas such as complex financial products and blockchain-based transactions.
According to the police, the partnership signals a recognition that financial crime has become a core national security and economic issue, rather than a niche regulatory concern. Egbetokun told the SEC delegation that the force was prepared to strengthen collaboration in all ways possible, noting that effective enforcement in the capital market had broader implications for economic recovery and growth.
“If the police unit attached to the SEC is strengthened, it is going to make significant impact on your enforcement drive,” the police chief said, adding that the force would support efforts to improve investor protection and market integrity. He also formally approved collaboration between the SEC and the police cybersecurity centre, a step regulators see as critical to policing online investment activity.
The push to strengthen enforcement coincides with a period of renewed momentum in the capital markets. Total market capitalisation has recently surpassed N100 trillion, according to the SEC, supported by equity market gains and a recovery in investor participation, prompting regulators to place greater emphasis on safeguarding recent advances.
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