SEC Warns Nigerians Of The Dangers Of MMM, Calls It Fraud
The Securities and Exchange Commission has raised the alarm over the activities of some online fraudsters, who are running an online investment scheme tagged ‘MMM Federal Republic of Nigeria’.
The fraudsters, according to SEC, carry out their illegitimate business via Nigeria. portal/platform, and are promising investors a monthly investment return of 30 per cent.
SEC said the venture had no tangible business model, describing it as a Ponzi scheme, where returns would be paid from other people’s invested funds.
Investopedia.com describes a Ponzi scheme as a fraudulent investing scam promising high rates of return with little risk to investors. The scheme generates returns for older investors by acquiring new investors.
SEC on its website, said, “The attention of SEC, Nigeria has been drawn to the activities of an online investment scheme tagged ‘MMM Federal Republic of Nigeria (nigeria.). The platform has embarked on an aggressive online media campaign to lure the investing public to take part in what it called ‘mutual aid financial network’ with a monthly investment return of 30 per cent.
“The commission hereby notifies the investing public that the operation of this investment scheme has no tangible business model hence it’s a Ponzi Scheme, where returns are paid from other people’s invested sum. Also, its operation is not registered by the Commission.”
SEC, therefore, advised the 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.”
In a related development, SEC said its attention had been drawn to the activities of one Mrs. Oge C. Ottiwu of No. 118 Zink Avenue, Opposite Eke Market, Awka, Anambra State, allegedly engaging in capital market activities without any registration within Anambra State and its environs.
“Section 38(1) of the Investments and Securities Act, 2007 requires any person who intends to use as a professional in the capital market or carry on securities business to be registered by the commission before engaging in such activities. It is therefore illegal to carry on any kind of capital market business without registration,” it said in a post on its website.