Is this the reason investment scams have thrived?

“If another MMM-like scheme arrived Nigeria today, many will still invest their supposed hard-owned monies into it,” many will say. The seller usually comes with enticing interest rates and usually present themselves as anti-poverty advocates. So, why not?

A typical example is Imu Ovaioza Yunusa, the founder and CEO of Ovaioza Farm Produce Storage Business (OFPSB), who was recently given the nickname ‘Facebook Yahoo Girl’, after she allegedly defrauded numerous investors to the tune of several billions of naira.

Ovaioza was arrested on April 18 by police officers from the Force Criminal Investigations Department (FCID), Abuja, while attempting to flee the country with her husband. Her work as an investment manager in Nigeria was done.

But, she is just one fish in the River Niger. Till date, many Nigerians still fall for these investment scams, and you can call it a lucrative business.

“My lawyer duly reached out to SEC and reported back to me (I was not the one who went to SEC) that SEC said they don’t regulate buying and selling. I must also admit that maybe we should have made a written application requesting for SEC to register my business, but unfortunately, we did not do so,” her statement read in part.

It was reported that market traders fell to a similar scheme that lasted years, and they only realised they were cheated on when the investment manager started defaulting on payments. This was up to 600 million naira.

In fact, if you have not been sent a DM, or seen an ad selling these investment options, you may want to check your internet connection, then refresh your social pages. It sometimes come from friends on WhatsApp and that may be the last wall that has been keeping your defence.

The reason investment scams thrive?

Look around you, there is a gross wealth deficit. Close to 90 million Nigerians can barely afford basic amenities, and many others live on ‘vibes and in inshallah’.

Financial security is news to more than half of Nigerians, and this has persisted. What the government does is 10,000 naira to traders and households, hoping that would help, while ignoring the root problems. The private sector can only do so much.

Poverty is a major phenomenon because Nigeria keeps addressing shadows. So, when someone who has barely seen 10,000 naira is promised 50% returns in one month, there is a 30% chance they’ll jump on it.

Drawing from that, seller’s prey on the ignorance of the victim and ensure they promise paradise on earth. This means that they know the investor will not bother verifying the platform before they invest.

Away from that is greed.

We may not agree but greed is a consistent theme in these investment scams, such that religion is not even enough to ask Nigerians to stay satisfied.

Many times, the preferable options are shortcuts and getting “double of your investment in two hours” is not an option a greedy investor is willing to lose.

Remember that greed in this case is not the same as taking an investment risk.

How to stop it?

  • Do proper research of a platform before investing.
  • Ask questions from people knowledgeable on such areas.
  • Check with the SEC when an investment manager approaches.

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