Ponzi Schemes’ Operators Risk N10m Fine – IST Warns
BY COBHAM NSA – Ready to match words with actions, the Investments and Securities Tribunal (IST) says it will no longer be business as usual for operators of Ponzi schemes as they risk a fine of at least 10 million Naira for infractions and fraudulent activities in Nigeria’s capital market.
According to the IST Chairman, Amos Azi, this is part of the punitive measures prescribed by the newly enacted Investments and Securities Act (ISA) to deal with those promoting illegal financial schemes across the country.
Azi, who spoke at a stakeholders’ engagement meeting to unveil the Tribunal’s new e-filing platform in Abuja on Friday, said the development is an upgrade on the repealed 2007 Act, which did not provide for such sanctions against Ponzi scheme operators.
He said the new provisions in the Act will serve as a deterrent and tackle the menace of illegal investment operators within the nation’s capital market.
Besides the sanctions, the IST Chairman said other significant innovations introduced by the Act include recognizing digital assets as securities, legal acknowledgment of cryptocurrency, and provisions for virtual service providers.
He said these additions allow for the establishment of virtual exchanges and broaden the Tribunal’s jurisdiction to adjudicate disputes arising in these areas, after passing through the complaint management framework.
Addressing IST’s onboarding to the e-filing platform, Azi described it as a positive development that would enhance the investment climate in Nigeria, noting that the initiative is poised to boost investor confidence and stimulate intentional capital investment in the country.
The IST boss, who disclosed that the stakeholders’ meeting was convened to ensure legal practitioners are adequately trained on the new system, also issued a note of caution, saying once the e-filing system becomes fully operational, the physical filing of cases will no longer be entertained.
Also speaking with journalists at the meeting, Chairman of the Nigerian Bar Association (NBA), Gwagwalada Branch, Owhor Clever, urged the Tribunal to extend training opportunities to NBA members to ensure seamless court proceedings under the new Act.
The stakeholders’ engagement on e-filing and case management also featured online participation from Abuja, Port Harcourt, and Enugu State, with the IST scheduled to go live with the e-filing platform in July 2025 barring any unforeseen circumstances.
