The Securities and Exchange Commission (SEC), the regulatory body for Nigeria’s capital market, has issued a warning to Nigerians about CMTRADING, an online platform falsely posing as a legitimate cryptocurrency and commodities trading outfit.
The Commission disclosed that CMTRADING is neither registered nor authorised to operate in the Nigerian capital market and described its operations as fraudulent and indicative of a potential Ponzi scheme.
SEC alerts on fake media and celebrity endorsements
According to a recent public notice signed by the Commission’s management, CMTRADING claims to operate under licenses from the Financial Sector Conduct Authority (FSCA) of South Africa, through GCMT South Africa Pty Ltd, and the Financial Services Authority (FSA) of Seychelles.
However, these claims have not been verified in the Nigerian context, and the Commission stressed that the platform has not been registered to solicit investments from the public or operate in any capacity within the Nigerian capital market.
The commission reported that the platform uses cloned websites of reputable media houses, such as The Punch Newspaper, Vanguard Newspaper, BBC, Channels Television, and Arise Television, to attract unsuspecting victims.
In addition to these fake sites, it also circulates doctored videos and images of well-known Nigerians to convince investors with the promise of huge monetary gains.
“The platform uses cloned websites… to attract unsuspecting victims,” the Commission noted, warning that such digital manipulation is a red flag investors should not ignore.
According to the regulatory body’s findings, the operations of CMTRADING exhibit the typical indicators of a fraudulent Ponzi scheme, including offering unusually high returns, operating a referral-based system to maintain payout flows, and issuing desperate requests for account funding.
“The Commission hereby informs the public that CMTRADING is NOT REGISTERED by the Commission either to solicit investments from the public or operate in any capacity within the Nigerian capital market,” the notice reiterated.
To safeguard their investments, members of the public are strongly urged to verify the registration status of any online investment platform through the SEC’s official websites: (https://home.sec.gov.ng/fintech-and-innovation-hub-finport/registered-fintech-operators) or [www.sec.gov.ng/cmos]
A repeat of the CEBEX scam?
This development echoes the recent CEBEX scandal, which defrauded thousands of Nigerians, Kenyans, and Egyptians. Like CMTRADING, CEBEX lured investors with too-good-to-be-true returns, only to disappear with their funds.
Many victims were left stranded after the scheme collapsed, underscoring the risks associated with unregulated investment platforms.
The SEC’s latest alert emphasises the importance of conducting thorough due diligence before investing.
“The Commission similarly reminds potential investors of the need to VERIFY the registration status of investment platforms,” the statement emphasised.