The Securities and Exchange Commission (SEC) has declared that the controversial digital trading platform, CBEX, which recently crashed and reportedly wiped out about ₦1.3 trillion of investors’ funds, was never registered with the commission.
The crash, which occurred on Monday, left thousands of Nigerians in shock, with many lamenting the sudden disappearance of their hard-earned money. CBEX had attracted attention for promising investors 100 per cent Return on Investment (ROI) within 30 days, an offer many now say was too good to be true.
Reacting to the development, the Director-General of SEC, Dr. Emomotimi Agama, said the commission was unaware of CBEX’s operations and had not received any official complaint about the platform before the crash occurred. He made the statement on Arise Xchange, a business programme on Arise TV, on Wednesday.
According to Dr. Agama, CBEX was not registered or regulated by the commission, making its operations illegal under Nigerian law.
“It’s important to state clearly that the SEC was not aware of the illegal operation of CBEX,” he said. “What happens often with schemes like this is that most people keep it away from the regulator, and even from their friends, except a select group they choose to inform.”
He explained that in many cases, these types of platforms operate in secrecy and avoid regulation to continue attracting unsuspecting victims without scrutiny.
Despite the huge losses reportedly suffered by thousands of Nigerians, the SEC boss said no investor had formally petitioned the commission prior to the crash. “As we speak, we have not received any formal complaint from anyone regarding CBEX,” he said.
“If we had received any formal complaint, the team at the SEC would have swung into action to trace those involved.”
News of the CBEX crash spread like wildfire on Monday, with social media platforms filled with painful stories from investors who claimed they lost life savings. Some people said they sold properties, borrowed money, or emptied their retirement savings to invest in what they believed was a “guaranteed” digital opportunity.
The platform, which promised investors a mouth-watering 100% ROI in 30 days, had become a viral name among many Nigerians seeking quick profits, especially during these hard economic times. With inflation and unemployment biting harder, more people have been drawn to risky and unverified online investment schemes.
Some victims of CBEX say they were lured through aggressive social media marketing and word-of-mouth campaigns that made the platform seem credible. CBEX also reportedly ran referral programs that encouraged existing users to recruit others with the promise of bonuses.
While expressing deep sympathy for the victims, Dr. Agama assured Nigerians that the SEC will now launch a full investigation into the matter and hunt down those behind CBEX.
“We sympathise very much with the victims because they are Nigerians,” he said. “SEC will commence investigation as to where these people are and make sure we hunt them down.”
He stated that the law gives the SEC the power to fine, sanction, and even prosecute anyone found to be operating an illegal investment scheme.
“The law actually has given us the power to take them down, find them, sanction them by fining and also sending them to prison for ten years. That’s the provision of the law,” the SEC DG stated firmly.
He further warned Nigerians to be cautious of any investment platform that is not registered or licensed by the commission. He reminded the public that the SEC had consistently issued warnings about unregistered digital trading and investment platforms that make unrealistic profit promises.
The CBEX scandal is the latest in a long list of Ponzi-style investment schemes that have collapsed in Nigeria in recent years. From the infamous MMM Nigeria to more recent platforms like MBA Forex, Brisk Capital, and others, millions of Nigerians have lost money to fraudulent schemes that offer quick returns but collapse once new funds dry up.
The Central Bank of Nigeria (CBN), SEC, and the Economic and Financial Crimes Commission (EFCC) have repeatedly warned Nigerians to stay away from such platforms. However, the trend continues, largely due to economic hardship and lack of financial awareness among the population.
Dr. Agama used the opportunity to call on the media, religious institutions, and community leaders to help sensitize Nigerians about safe investing and the importance of dealing only with registered investment firms.
The SEC urges Nigerians to verify the registration status of any investment firm before putting in money. The commission regularly publishes a list of registered capital market operators on its website.
“Any platform or individual that is not registered with SEC is operating illegally,” the DG said. “And any investor who puts their money there is doing so at their own risk.”
He added that the SEC is stepping up its monitoring of online investment platforms and is working with other agencies to shut down illegal operators and protect the public.
