Shadows of deception: Financial frauds and scams

FINANCIAL fraud is a pervasive challenge that poses a significant threat to the economic stability of nations globally. Nigeria, a country with a rapidly growing economy, is unfortunately no exception to this menace. This article delves into the intricate landscape of financial fraud in Nigeria, exploring its root causes, prevalent forms, and the measures being taken to combat this pervasive issue. In 2016, the Securities and Exchange Commission (SEC) brought the attention of the investing public to the Federal High Court Kaduna division’s judgment of October 27, 2016. The court sentenced Moses Samanja, the Managing Director of the illegal operator (Marian Moses Ventures Ltd), to a five-year imprisonment term. Additionally, it ordered the Corporate Affairs Commission (CAC) to wind up Mariam Moses Ventures Ltd, using the firm’s accounts’ funds to restitute its clients. Mariam Moses Ventures Ltd was convicted of soliciting and collecting deposits from unsuspecting members of the public, promising unrealistic returns on investment without SEC registration or a CBN license.

The conviction of this illegal operator serves as a stark warning to perpetrators of illegal investment schemes. It emphasizes that regulators will not simply “stand idly by” in the fight against the activities of illegal fund/investment managers. Therefore, it is strongly advised that the investing public always demand SEC registration or a CBN license before making deposits or subscribing to any scheme promoted by a firm. Fast forward to 2022, just when we thought that the Marian Moses Ventures Ltd case was an isolated incident, the Cala robot scam emerged. Last May, a friend introduced me to a cryptocurrency app named Cala. Although the app’s promises of high returns on investment sounded intriguing, I noticed certain red flags and expressed concerns about my friend’s seemingly blind acceptance of the app’s claims. As I probed further, he explained that Cala was a robot trading and maximizing interest simultaneously. Despite my warnings and attempts to reason with him using my superior arguments and raised points, he remained unconvinced, blinded by the app’s enticing allure. As if I had foreseen it, investors eventually lost their investments when the Cala app crashed. My conscience is clear because I had warned my friend and others about the app’s potential to be a scam before it crashed. Cala was a disaster waiting to happen, but many were blinded by greed and failed to see through the lens of wisdom; they were defrauded. I heard stories of gullible Nigerians investing millions of Nairas, some even losing their lives due to heart attacks. The friend who introduced me to the app also fell victim to Cala and vanished after the crash.

The Cala app clandestinely used unsuspecting users to lure new users with commissions. Upon further investigation, I discovered that Cala had a phantom office in Lagos, which was not suitable for an investment company as they claimed to be. They stated that their headquarters were in Armonk, New York, US, which turned out to be a well-crafted lie. Before the app’s crash, they held seminars and conferences, providing footage of these events to further deceive potential investors. The Ponzi scheme app, now off the radar, presents a business name registration from the Corporate Affairs Commission in Nigeria and a Special Control Unit Against Money Laundering (SCUML) certificate. However, I cannot independently verify if those certificates are legitimate. Government agencies tasked with reining in on these illicit apps should focus their searchlight on them.

Other notable financial frauds and scams

The Hushpupi case, which involved an international criminal syndicate defrauding companies and influential individuals, garnered significant attention from the mainstream media and cyberspace. There are also individuals who use religion as a guise to defraud unsuspecting victims. One prominent case is that of Chimanya, who recounted, during a radio program phone call, the deceitful practices of fake pastors who defraud their victims under the guise of prophecy. According to her, her mother generously gifted a car to a man claiming to be a pastor. Her mother was introduced to the man through her uncle. The man took her car, and when her son objected and tried to retrieve his mother’s car, the fake pastor had him arrested and locked up. Her mother, completely mesmerized by the pastor’s fake prophecies, asked the police to keep him in the cell. It was his siblings who intervened and bailed him out. Their bedridden uncle, who introduced her to the pastor, eventually confessed to providing the pastor with her information. He suffered an agonizing death. The pastor was ostracized from the village, and the church was burnt down.

Sometime last year, I had a similar experience while sitting on a bench with a gatekeeper when a middle-aged man approached us. I remained quiet. Before I could say anything, the man attempted to strike up a conversation. Without warning, he began talking about a ‘marabout’ two blocks away, claiming the individual possessed miraculous powers, a place sought after by both men and women for divine intervention. As I listened intently, it dawned on me that this man was an agent of the marabout and had ulterior motives. While the gatekeeper was captivated by the agent’s pitch, I enlightened him before leaving. Realizing our lack of interest, the man eventually departed. This tactic is one of their modi operandi. Many have fallen victim to internet and mobile fraud, receiving messages claiming to be from prominent personalities giving out cash. To claim this cash, you’re asked to pay a certain amount or they post adverts on the internet claiming to provide jobs and more. This is happening too often. These unscrupulous people often go unpunished.

In conclusion, the shadows of deception continue to loom large in the realm of financial frauds and scams. Vigilance, education, and proactive regulatory measures are essential to protect individuals and communities from falling victim to these ever-evolving schemes.

  • Tanimu, a freelance architect and writer, lives in Kaduna, Nigeria.

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