Almost every year—particularly since the collapse of MMM, a Ponzi scheme that swindled Nigerians out of over ₦18 billion in 2016—thousands of Nigerians continue to lose their hard-earned money to online investment scams.
The latest, which raised major concern over the weekend, is CBEX. The cryptocurrency platform claims users can trade digital assets like Bitcoin, Ethereum, and other cryptocurrencies with 99 percent accuracy using its Artificial Intelligence (AI) technology.
How CBEX Deceived Nigerians with Promises of Risk-Free Investment
Although the acronym CBEX appears to stand for China Beijing Equity Exchange—an equity transaction platform run by the Chinese government—it has no ties with the government-run business and, in fact, only began operations recently, contrary to the widely circulated claim by the platform’s promoters that it has been in operation since 2017.
Their tactic for swindling Nigerians was similar to the style adopted by other Ponzi schemes that have operated in the country—offering seamless financial rewards with little or no risk.
Daniel Ukaegbu, a Lagos-based creative who invested in CBEX, told Neusroom that he was promised 100 percent returns on his investment after 45 days.
“I invested $300 around September last year, and after 45 days, I received double my money,” Ukaegbu said. “I reinvested again, and as of March when I withdrew my last investment, I had made more than ₦3,000,000.”
The spread of CBEX was largely fueled by friends, family members, and online promoters who, after receiving their returns, hailed the platform as legitimate. Ukaegbu said he was introduced to the platform by a longtime friend.
In a 2022 special report, Neusroom showed how Nigerians were often willing to take the risk of investing in Ponzi schemes because a family member, friend, neighbour, or colleague convinced them to do so.
Aside from family and friends recruiting investors into the schemes, some platforms also engage influencers.
On March 11, 2021, pop artiste Rema tweeted a photo of naira notes to endorse Brisk Capital Ltd:
“Hustle Thursday. ROI from my investment with @BriskCapitalLTD just came in, nice one my gees,” he wrote in a tweet that was reshared over 1,000 times and liked more than 11,000 times before being deleted a few weeks after Brisk Capital crashed.
Rema’s tweet led many Nigerians to invest in Brisk. Barely a month later, the scheme crashed.
While Ukaegbu was lucky to have withdrawn his investment before the crash, many Nigerians were not.
In an X Space hosted by Trending X, Taiwo Owolabi, a cryptocurrency expert, claimed the stolen money had been moved to a TRX address (TDqSquXBgUCLYvYC4XZgrprLK589dkhSCf), adding that the total amount stolen in USDT was $847 million (₦1.2705 trillion).
Another crypto analyst, who preferred to remain anonymous, told Neusroom that CBEX is a scam and that users with funds still on the platform may never recover their money.
“Never trust anything they tell you is risk-free,” he said.
Why Nigerians Ignore Visible Red Flags and Fall Victim to Ponzi Scams
According to the Nigeria Deposit Insurance Corporation (NDIC), between 1999 and 2023, Nigerians lost ₦911.45 billion to Ponzi schemes—with ₦300 billion lost in the five years following the collapse of MMM.
Yet, year after year, the collapse of one scheme gives way to another, with thousands of Nigerians falling victim.
From Twinkas to Givers Forum, Ultimate Cycler, ReapWay Holdings, MBA Forex and Capital, Brisk Capital, Megawill Integrated Global, B2 Consults, Swiss Gold Market, S.U Global, Wales Kingdom Capital, Quintessential Investment Company, and Chinmark Group, among many others, Nigeria seems to never run out of Ponzi schemes.
The crash of Chinmark in April 2022 reportedly claimed the life of one of its victims, identified as Mrs. Nuella.
Despite the warnings and constant social media outrage sparked by these crashes, many Nigerians continue to fall for new schemes. Just two weeks after outrage trailed Nuella’s death, another scheme—Ovaioza Farm Produce Storage Business (OFPSB), an agricultural service company that claimed to specialise in buying, storing, and reselling produce—also made headlines for failing to account for ₦3 billion invested by Nigerians.
Earnest Ajadu, an investment banker and Head of Wealth Management at Afrinvest Ltd, a financial advisory firm based in Lagos, told Neusroom that poverty and greed push people into such schemes.
“The level of poverty in the country is alarming,” Ajadu said. “People fall prey to these scammers out of desperation to get additional income for basic needs like food, shelter, and clothing—it’s not even about living an extravagant lifestyle.”
Emmanuel Adetayo, a financial analyst, believes that while poverty plays a major role, greed and lack of proper financial education are significant reasons why Nigerians remain susceptible to Ponzi scams.
“It’s true that there is poverty and people are trying to find quick ways to make money, but greed also plays a major role in why people invest in Ponzi schemes,” Adetayo said.
“Many are not investing just to make an extra buck for a meal, but because they want to double their large sums.”
Ukaegbu confirmed to Neusroom that he knew CBEX was a Ponzi scheme but invested anyway.
“Although I know people made a lot of money through CBEX—people bought cars and built houses—I believed it was a scam. The red flags were there.”
Speaking at a virtual session with fintech stakeholders on April 14, SEC Director-General Emomotimi Agama reminded Nigerians that any platform not registered with the SEC is illegal.
“Recently, a particular platform has gained attention online, with numerous posts going viral regarding its activities. Subsequently, there have been reports suggesting its shutdown. I want to make this absolutely clear—if a platform is not registered with the SEC, it is illegal.”
As many nurse their losses, it’s unlikely that the collapse of CBEX will mark the end of Ponzi schemes in Nigeria. Adetayo added that a major enabler is the high rate of financial illiteracy in the country.
“How many Nigerians know about the SEC and that any platform not registered with them might be operating illegally? Nigerians need to be properly educated about legitimate means of investment,” he said.
