New ISA 2025 Empowers SEC to Crack Down on Ponzi Schemes with 10-Year Jail Terms and N40 Million Fines

The Director-General of the Securities and Exchange Commission (SEC), Mr. Emomotimi Agama, has revealed that the recently enacted Investments and Securities Act (ISA) 2025, signed into law by President Bola Tinubu, grants the Commission robust powers to prosecute promoters of Ponzi schemes. Speaking during an interview with Arise TV on Tuesday, Agama highlighted that offenders now face a minimum of 10 years in prison, marking a significant shift in the SEC’s ability to tackle financial fraud.

Agama explained that prior to the ISA 2025, the SEC lacked the legal authority to bring Ponzi scheme operators to justice, leaving the Commission powerless to act effectively. “With this new law, they now face a jail term of 10 years or more,” he emphasized, underscoring the legislation’s intent to hold perpetrators accountable.

N40 Million Fine and Beyond

In addition to imprisonment, the SEC DG noted that the new Act imposes a N40 million penalty on anyone caught running a Ponzi scheme in Nigeria. Addressing concerns about whether this fine suffices for fraudsters who may have swindled billions, Agama clarified that the N40 million is only part of the punishment. “It’s not the entirety of the penalty,” he said. “The law introduces disgorgement, meaning every illicit profit or gain made from defrauding Nigerians will be recovered.”

He stressed that the focus is not solely on the scale of the fraud but on creating deterrents strong enough to discourage such activities. “The sanctions are designed to stop people from even considering these schemes,” Agama added, noting that the SEC now has the tools to pursue offenders and ensure restitution for victims wherever possible.

Expanded SEC Powers

Beyond prosecution and penalties, the ISA 2025 equips the SEC with additional capabilities to combat financial misconduct. Agama revealed that the Commission can now access telephone conversations and other communications critical to building cases against Ponzi scheme operators. “This law gives us everything we need to go after bad actors and bring relief to Nigerians,” he said.

Boosting Investor Confidence

Agama emphasized that these enhanced powers will help the SEC eliminate fraudulent operators, paving the way for a safer investment environment. “By getting the bad guys out, we’re ensuring Nigerians can invest with greater confidence, knowing the SEC’s investor protection mandate has been significantly strengthened,” he concluded.

The ISA 2025 represents a turning point in Nigeria’s fight against financial fraud, empowering the SEC to safeguard the capital market and restore trust among investors.