Nigeria's House of Representatives has issued a strong caution to public figures, celebrities, and influencers against endorsing unregistered investment schemes, following the dramatic collapse of a fraudulent cryptocurrency platform known as "CBEX." Lawmakers emphasized that under the newly enacted Investments and Securities Act (ISA), those found promoting such illicit ventures could face significant legal repercussions.
The House expressed deep concern over the alarming reports surrounding the downfall of CBEX, a digital asset trading platform that has reportedly ensnared the funds of thousands of Nigerians. The estimated financial exposure is staggering, exceeding N1.3 trillion, leaving countless investors in a state of uncertainty and financial distress.
Prior to its collapse, the Securities and Exchange Commission (SEC) had already flagged CBEX as an illegal operation, stating that any digital asset trading platform operating in Nigeria without SEC registration was in violation of the law. More recently, the Economic and Financial Crimes Commission (EFCC) has also stepped in, vowing to collaborate with Interpol and other international agencies to track down the perpetrators and recover the lost investments.
New Investments and Securities Act Bolsters Investor Protection
Highlighting the legal framework now in place, the House of Representatives underscored the significance of the Investment and Securities Act (ISA) 2025, recently signed into law by President Bola Ahmed Tinubu. This landmark legislation, the culmination of sustained efforts across several legislative assemblies, significantly strengthens the enforcement powers of the SEC. It explicitly criminalizes Ponzi schemes and related fraudulent activities, introducing stricter penalties that include imprisonment for up to ten years.
"Through these reforms, the investor protection responsibility of the SEC has been enhanced, reinforcing its mandate to shield Nigerians from fraudulent investment activities," the House emphasized in a statement released by its Spokesman, Rep. Akin Rotimi, Jr.
The House urged Nigerians to exercise extreme caution when considering investment opportunities and to meticulously verify the legitimacy of any platform with the SEC and other relevant regulatory bodies. "Citizens must remain vigilant to the hallmarks of fraud, especially promises of high returns with little or no risk," the statement advised.
The warning was particularly directed at public figures. "Furthermore, public figures, celebrities, and influencers are reminded of their civic and legal duties. Under the new ISA, promoting unregistered investment schemes could attract liability for aiding financial misrepresentation and consumer deception," the statement explicitly read.
Recognizing the broader societal impact of such scams, the House also called upon schools, faith-based organizations, media outlets, and civil society groups to actively participate in a national effort aimed at promoting financial education and safeguarding the public from predatory schemes.
Rep. Solomon T. Bob (PDP, Rivers), Chairman of the House Committee on Capital Market and Institutions, stressed the importance of both enforcement and education. "We must continue to confront financial fraud with the full weight of the law. But beyond enforcement, we must invest in public awareness. Financial literacy is not optional; it is essential in building a resilient, inclusive economy. Fraudsters thrive where ignorance prevails," he remarked.
The House extended its sincere empathy to the numerous citizens currently grappling with distress and uncertainty due to their involvement in the CBEX investment scam. They noted that the EFCC and the Nigeria Police Force have already commenced coordinated investigations, working in conjunction with Interpol to locate the individuals responsible, protect investors' interests, and recover any recoverable funds.
CBEX Collapse Leaves Investors Stranded
CBEX, a digital investment platform reportedly operated by a group of foreign nationals in partnership with Nigerian collaborators, abruptly collapsed on Monday, leaving thousands of investors locked out of their accounts and unable to access their funds. The platform had enticed investors with the promise of extraordinarily high returns – a staggering 100% within just 30 days through online trading.
Red flags began to appear on April 9, 2025, when CBEX first restricted withdrawals. Initially, many users believed this to be a temporary technical issue. However, their hopes were dashed when account balances suddenly and inexplicably vanished.
In a bizarre and ultimately suspicious move, affected users were subsequently instructed to deposit additional funds to regain access to their accounts. For those with balances below $1,000 before the alleged losses, a deposit of $100 was demanded. Investors with balances exceeding $1,000 were required to deposit $200.
Shortly before completely shutting down its platform, CBEX issued a message to its subscribers stating the need for "verification steps" to ensure account authenticity, further detailing the required additional deposits and instructing users to keep deposit receipts for "future withdrawal reviews."
Despite these clear indicators of a failing or fraudulent operation, reports suggest that a number of new users continued to sign up even after the initial withdrawal restrictions, apparently believing the issues were temporary and would soon be resolved. This highlights the persuasive tactics often employed by such schemes and the critical need for increased financial literacy and public awareness campaigns. The collapse of CBEX serves as a stark reminder of the risks associated with unregistered investment platforms and the importance of due diligence before entrusting funds to any entity promising unrealistic returns.