Since time immemorial, the fraud industry has continued to wax stronger.
Despite the introduction of multiple strategies to weaken it’s growth and devastating economic impact, the trade continued to defy laws, policies, and even stringent cultural traditions put in place as deterrent measures.
Ultimately, unsuspecting inflicted maximum economic pains as their hard earned money is made to vanish like a mirage.
While Ponzi Scheme is a global phenomenal, it has become more brutish and nerve wrecking in countries with troubling economies, Nigeria inclusive.
Globally, industrialisation, which represents large scale manufacturing and exportation, remains the bedrock of a thriving economy, with strong currency, GDP, reduced inflation and impressive employment opportunity, as supporting system.
But the same can not be said of the third world countries who are still grappling with social amenities needed to achieve this industrialisation project.
The attendant effect is the unemployment induced large scale poverty, hunger and desperation to survive.
The situation is worse in some countries with bad political leaders whose agenda is rather enwrapped in perfect deception to build castle in the air for the poor and vulnerable citizens of their country instead of delivering good governance.
As this pathetic cycle of hopelessness continues, organised criminals continued to exploit the loopholes as an irresistible catchment point to lure the desperate and economically vulnerable people into their dark web of fraudulent and deceitful financial trades.
Kiin360 can report that the struggle to escape poverty, starvation and the indignation that comes with it, has continued to propel Nigerians to engage in anything that can give them financial reprieve.
There is also an assumption of widespread greed, the kleptomaniac Disorder being displayed by many who wants to live a life that they have not worked for or earned.
In the past 23 years, for instance, Nigerians have repeatedly fallen to different kinds of fraudulent schemes.
Better described as “Economic investment miracle,” most of these schemes, demand a modest saving of their money with them, with a promise of as much as 30% Return on Investment (ROI).. The ROI is usually paid within a month cycle after such an investment.
Too good to be true?
Yes, our investigation has revealed.
So far, Nigerians alone, have lost over ₦911 billion ($611M +) of their hard earned money to this economic exploitation trade.
The losses are not inclusive of the growing trade of lottery and gambling industry in the country, another silent exploiter of the Nigerian populace.
For context, the huge loss incurred from Ponzi Schemes in Nigeria alone is enough to power Comoros’ $300Million national budget (in 2024), or Sào Tomé and Principe’s $150Million National Budget for 2025, for two years with some change. The amount is enough to fund the state budgets of more than five States in the Northern geopolitical zones of the country, and many more in the Southern part, as well.
List of major Ponzi schemes in Nigeria
Emmanuel Nwude Fraud (1995–1998)
Though not a typical Ponzi scheme, it was one of Nigeria’s largest financial frauds. Nwude sold a fake airport project to a Brazilian Bank at $242 million.
Nospectco Oil and Gas (2005)
Hiding behind the booking global oil and gas economy, the scammers looted investors into depositing their money with the company, in hopes of getting mouth-watering RoI. At the end of the day, over ₦49 billion was lost to the collapse of the business. One of the victims, Najeemdeen Agboke, told Kiin360 that he would never forget the pains he suffered because of the loss of his money to the scam.
“Nuspecto looked so good like a legit business. This was because the business concept aligns with the nation’s rich oil wealth. It was a common sense to invest in private businesses trying to break even in the sector dominated by International Oil Companies with financial war chest. Only to be defrauded along the line
“All of my earnings, from business, and inheritance from my late mum, were gone. The loss has given me a scar that has refused to heal till today,” he said.
Pennywise (2006–2008)
When you are “it is too good to be true,” Pennywise Scam is the typical example of it. The scheme promised investors of 100% RoI on investment after just two weeks of doing so.
Losses incurred was ₦1.93 billion.
MMM Nigeria (2016)
One of the most infamous Ponzi schemes in Nigeria is the MMM scheme. It is a savings and withdrawal scheme. Over 3 million Nigerians were affected by its ultimate crashing, with a total of N18billion losses.
Ultimate Cycler (2016)
This scheme represents another frontier for best way to make “legitimate” off of the internet. Participants were asked to pay the sum ₦12,500 as subscription fee and were required to recruit others. The site suddenly went offline.
Paycycler (2017)
Paycyclet was an online platform promising weekly profits to investors until it collapsed in April 2017, taking with it, depositors’ over ₦2.5 billion.
Benignant Forte Nigeria Ltd (2021)
Victims of this scam were close to getting justice when the Chief Executive Officer was arrested by the law enforcement agency. But the arrest could not lead to the refund of the over N10billion of depositors’ money.
Quintessential Investment Company (2021)
Founded by a 22-year-old, the company projected itself as a go-to for temporal and permanent relief against financial challenge. It ended up defrauding over 170 investors before folding. Over N10.8Billion lost.
BBHTV (2024)
This company presented itself as an international conglomerate, with investment interests in entertainment, media, pageantries among others. Over 2.7 million Nigerians, who subscribed to it, had their over ₦89.4 billion savings frozen by the government. It is not clear whether owners with proof of transfer have been repaid by the government.
Baraza Multipurpose Cooperative Society (2024)
Baraza claimed to provide corporative services to the Nigerian public, with an allurement of 25% RoI on every deposit made, after the life cycle of the trade. It turned out to be a fraud. Over ₦2 billion of unsuspecting depositors were lost
Reliance Microfinance Cooperative (2024)
Hiding behind the legitimacy of financial services in the country, fraudsters presented a deposit financial institution to ultimately ran away with depositors’ over ₦71.58 million savings. The arrest and indictment of the operator could not undone the loss.
Why Do Ponzi Schemes Thrive in Nigeria?
Four key factors fuel these scams:
- Economic Hardship
High unemployment (33%), inflation (30% in 2024), and naira devaluation pushed Nigerians toward “get-rich-quick” illusions. - Financial Illiteracy
Many don’t understand basic investment principles. How can a scheme promise 30% monthly returns when even top-tier stocks average 15% annually? - Social Media Hype
WhatsApp, Facebook, and Instagram testimonials create FOMO (fear a suit today, fly private tomorrow!). Loom Money recruited 90% of its victims this way. - Weak Regulation
The SEC and EFCC often act too late. For instance, banks allegedly hid ₦1.12 billion in Ponzi funds in 2019, yet no major penalties followed.
How to Spot and Avoid Ponzi Schemes
Protect yourself with these steps:
- Question “Too Good” Returns
If returns are sky-high (e.g., 30% monthly) and “risk-free,” it’s a scam. Even Elon Musk doesn’t promise that! - Verify Registration
Check if the company is registered with the SEC or CBN. MBA Forex wasn’t—a red flag ignored by many. - Avoid Recruitment Pressure
Legit investments don’t require you to recruit friends. If it feels like a cult (e.g., MMM’s “community”), walk away. - Consult Experts
Talk to licensed financial advisors. The ₦5,000 fee you save by skipping advice could cost you ₦5 million later.
The Cost of Ignorance: A Nation at Risk
The human toll is chilling:
- 4,000 students nearly expelled after losing $6.5 million in tuition to a Ponzi scheme.
- Low-income earners mortgaged homes, while professionals emptied retirement accounts.
- ₦25.5 billion lost to e-fraud (2020–2024), showing scammers are evolving with technology.
