Senate Launches Investigative Hearing into Ponzi Schemes, Probes ₦1.3trn CBEX Fraud

By Iyojo Ameh

The Nigerian Senate has resolved to investigate the alarming rise of Ponzi schemes in the country, with a specific focus on the recent collapse of the digital investment platform, Crypto Bullion Exchange (CBEX), which allegedly defrauded millions of Nigerians of over ₦1.3 trillion (approximately $847 million).

The resolution followed a motion sponsored by Senator Mukhail Adetokunbo Abiru (Lagos East) and Senator Osita Bonaventure Izunaso (Imo West), during plenary on Wednesday, July 9. The lawmakers expressed deep concern over the growing prevalence of fraudulent and unregulated investment platforms that have wreaked havoc on the financial wellbeing of citizens.

Presenting the motion, Senator Abiru noted that Nigeria had witnessed a troubling pattern of financial scams in recent years, including notorious cases such as MMM Nigeria in 2016 and MBA Forex in 2020. He described CBEX as “one of the most devastating financial scams in the country’s history,” adding that the platform leveraged technology and social media to lure unsuspecting investors with promises of outrageous returns.

“Millions of Nigerians lost their hard-earned money through CBEX, which used referral commissions, celebrity endorsements, and fake testimonials to build credibility,” Abiru said.

The Senate expressed shock that CBEX operated openly and at scale without sanctions or intervention from key regulatory bodies such as the Securities and Exchange Commission (SEC), the Central Bank of Nigeria (CBN), the Nigerian Financial Intelligence Unit (NFIU), or the Economic and Financial Crimes Commission (EFCC).

Senator Izunaso, co-sponsor of the motion, emphasized that Nigeria’s socio-economic environment—including high youth unemployment, poverty, and low financial literacy—makes the public particularly vulnerable to such scams.

The lawmakers stressed that the failure of regulatory agencies to act in a timely and coordinated manner enabled CBEX and similar platforms to flourish unchecked, eroding trust in the country’s financial system and exposing the economy to systemic risk.

Citing Section 88(1)(a) and (b) of the 1999 Constitution (as amended), the Senate resolved to invoke its constitutional powers to investigate the CBEX scandal and other related schemes. It mandated a joint probe by its Committees on Capital Market; Banking, Insurance and Other Financial Institutions; Anti-Corruption and Financial Crimes; and ICT and Cybercrime.

The joint committees are expected to conduct a comprehensive investigative hearing— including a public hearing—on the operations of Ponzi schemes in Nigeria and report back within four weeks.

The Senate also underscored the urgent need for public education campaigns to protect citizens, particularly vulnerable groups, from falling prey to financial predators.