Fake investment schemes fraudsters use to defraud Nigerians.

Sylvester Maduka’s face bore a tell-tale sign of sadness as he stood in front of an office in the Oregun area of Ikeja, Lagos penultimate Thursday. The 40-year –old entrepreneur could not believe that he had just been conned by an investment firm that promised a mouthwatering return on his investment a few weeks earlier.

According to him, he was introduced to the firm by one of his business associates who regaled him with the story of how he earned 70 per cent interest on the sum of N1.5 million he invested in the company. Believing what he heard, Maduka splashed N2 million on the business and got his principal earning and accrued benefit on investment a few weeks after.

Moved by the fast and huge returns, he increased his investment portfolio to N4 million. But his hope of another bountiful harvest from the sum sowed were dashed when he found the premises of the firm under lock and key.

”Oh, I have been swindled. My money is gone,” he said.

”I never knew that I was gambling when I splashed almost 60 per cent of my business capital on the investment scheme which has turned out to be fake,” he added.

Maduka’s case is just one out of many distraught victims of fake investment schemes otherwise called Ponzi, which are being used by fraudsters to dupe thousands of Nigerians across the country.

Like Maduka, over 500 desperate ‘investors’ fell to the dubious trick of a young fraudster, Dominic Ngene Joshua, who operated under the name Brisk Capital Limited, and defrauded his victims to the tune of N2 billion in investor funds.

Joshua was apprehended in May this year by the Special Fraud Unit (SFU) of the Nigerian Police in Lagos, following complaints by his victims who invested cash in his cryptocurrency trading.

According to the police fraud unit, Joshua allegedly promised investors a 60 per cent return on investments in oil and gas, FOREX and real estate.

The Commissioner of Police in charge of SFU, Anderson Bankole, said the suspect lavished investor funds on luxury items such as wristwatches, posh cars, real estate and extravagant parties in Lagos, Port Harcourt and Abuja.

CP Bankole added: “The funds belonging to over 500 investors was diverted to sponsor extravagant lifestyle, parties, exotic cars, luxury watches and real estates in Abuja, Lagos, and Port Harcourt.

“The suspect confessed to the crime but pleaded to be given time to return the monies. Some of the properties/items purchased with the diverted funds have been recovered as exhibits while the suspect will be charged to court.”

A crowd of frustrated investors launched into lamentations in front of a building at Ile Epo area of Agbado/Oke Odo Local Council Development Area on July 15, 2021, after they discovered they had been swindled by a finance house that lured them with payment of a bogus return on money invested.

One of the victims, Alice Majemite, a trader, said she was introduced to the firm by one of her close friends and had invested N500,000 with the firm.

Majemite and others were anxiously expecting the promised yield on their money when the operators of the firm identified as Mr Adekanye and Olatunji eloped and locked their office tucked inside a shopping mall, just a stone’s throw from the popular Ile Epo Market.

”My whole world has collapsed. I don’t know if I would survive this terrible loss. I blame myself for falling for their bait when they lured me with high profits on investment.

”I was actually introduced to the investment scheme operated by the company by one of my friends who was paid her huge profit on the N200,000 she invested. I never knew that they are fake.”

In a joint operation conducted by the Lagos and Edo police commands late last year, the kingpin of an amalgam of ten groups under the name CBN Helping Hands Investment Scheme, Solomon Osiga Ezemede aka Musa Mukarat and Solomon Musa was arrested in Lagos.

The arrest followed a petition to the police by the Central Bank of Nigeria (CBN) that the syndicate had impersonated the apex bank to defraud unsuspecting members of the public to invest their money in dubious high yielding schemes.

How victims are swindled

The syndicates swindled their victims using various investment schemes such as real estate, agro-allied, oil and gas to lure investors into their net.

For example, Maduka was lured into investing his princely sum in a real estate scheme which the syndicate promised would give him a fast return on investment.

”I was told by the dubious operators of the finance house that they have landed property scattered all over the country and they showed me audio-visual proof of the estates and beneficiaries of the scheme, who testified to the genuineness of the investment. I fell for it flatly,” Maduka said.

Osemede’s syndicate, according to the police, perpetrated out its fraudulent activities using various fake CBN Facebook accounts, mobile telephone numbers, fictitious internet profiles and paid testimonials to lure or induce victims into paying money into numerous bank accounts.

The syndicate, which also operated in parts of the Auchi area of Edo State, also promised to double the amount invested within 24 hours.

Ezemede has since been charged to the Magistrate’s Court in Ebute Metta, Lagos, on a four-count charge of conspiracy, obtaining money by false pretence, fraudulent act and stealing.

The Acting Director, Corporate Communications Department of CBN, Mr Osita Nwanisobi, said the syndicate had defrauded many people, using the official paraphernalia of the apex bank including seal and logo among others.

Majemite was induced through an oil and gas investment scheme which the syndicate promised would yield returns on a weekly basis with a large profit margin.

“I attended their seminar, where they showed us their oil and gas business in the downstream sector including their supply chain and workers. I believed them because some people testified to how they received their profit on investment a few days after they invested money.

“I never knew the testimonials were stage-managed by the fraudsters to scam me and others who were new investors. We reported the case to the police but it was difficult locating the address of their head office somewhere around Jibowu area of Yaba, Lagos as displayed on their office frontage.”

Experts caution the public on fake investment schemes

Security and investment experts urged the public to show circumspection when approached by portfolio operators and finance houses with promises of high yielding returns on money invested.

Festus Lawson, a financial advisor, urged people to ”eschew desperation capable of making them to fall into the hands of the dubious investment portfolio managers.

”Reaping profits from investment is not by magic; it takes time. Hence, people should be careful about jumping into the hands of fake and fraudulent persons disguising as investment managers when they are actually Ponzi scheme operators.”

Lawson added: “When approached by such investment managers, people should carry out checks with relevant regulatory agencies, especially the Security and Exchange Commission (SEC), to ascertain if the firm is duly registered and licensed to operate as investment managers. Doing so would save them from swindlers.”

CP Bankole advised the public to be wary of investment/portfolio managers that promise very high returns on investments.

He urged potential investors to show tact by approaching his office for credible information and carry out background checks, noting that the SFU has a working relationship with relevant regulatory agencies.

Nwanisobi cautioned members of the public to be wary of fraudsters who parade themselves as staff or agents of the bank to swindle them, urging them to report such persons or syndicate to the nearest police station.

A financial security practitioner, Anthony Oriabor, said that any financial scheme that promises huge returns is not real.

”Real investment is different from money doubling. Real investment is verifiable in structure and procedure, so is the investment portfolio manager. But money doubling is everything but genuine. It is a mirage and those who fall for its various baits are overwhelmed by greed to invest their money in these dubious schemes.

‘’I, therefore, want to urge people to shun any investment plan that comes with quick or fast returns within few days. Also, people should learn to visit the office of relevant regulatory agencies to find out if those promising them fast return on investment are duly registered under the laws of the country.”

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