By:Bulus Bako
The Securities and
Exchange Commission, on Thursday warned Nigerians about radio advertisements
and other modes of solicitations of the public to invest in crypto currencies
such as Swisscoin, OneCoin, Bitcoin and such other virtual or digital
currencies.
According to SEC, the
public must exercise extreme caution with regard to digital (crypto currencies)
as a vehicle of investments.
It further warned
Nigerians that none of the persons, companies or entities promoting crypto
currencies had been recognised or authorised by it or by other regulatory
agencies in Nigeria to receive deposits from the public or to provide any
investment or other financial services in or from Nigeria.
“The public should
also be aware that any investment opportunities promoted by these persons,
companies or entities are likely to be of a risky nature with a high risk of
loss of money, while others may be outright fraudulent pyramid schemes,” the regulator noted.
The SEC added, “Given
that these instruments and the persons, companies or entities that promote them
have neither been authorised, nor any guidelines/regulations developed for them
by any of the regulatory authorities in Nigeria, there is no protection
available to users or investors in these virtual currencies from financial
losses if the virtual currencies fail or the companies promoting them go out of
business.
“The public and
consumers of financial services are further advised that before making any
investment or entering into any financial services transaction they should
ascertain that the entity with whom the investment or transaction is being made
is authorised by the commission or other financial services regulatory
authority as applicable to provide such services.”
SEC had in August this
year, raised the alarm over the activities of some online fraudsters, who
operated an online investment scheme tagged ‘MMM Federal Republic of
Nigeria.’
According to Punch,
the fraudsters, SEC said then, carried out their illegitimate business via
Nigeria.mmm.net portal/platform, and were promising investors a monthly
investment return of 30 per cent.
It warned that the
venture had no tangible business model, describing it as a Ponzi scheme, where
returns would be paid from other people’s invested funds.
The commission,
therefore, advised the general public to distance themselves from the online
scheme, adding, “Please note that anyone that subscribes to this
illegal activity does so at their own risk.”
The scheme in December
last year, went under, leaving many Nigerians in pains following huge financial
losses.
-Punch
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