BREAKING: Nigerians Have Lost ₦4.8 Trillion to Pyramid Scams Since MMM in 2016, Economist Alaje Raises Alarm as CBEX Collapse Sparks Outrage
As panic erupts across Nigeria following the sudden crash of CBEX, a digital investment platform that promised to double investors’ funds within a month, Chief Economist at SPM Professionals, Paul Alaje has emphasised the need for investment education, highlighting that Nigerians have lost an estimated ₦4.8 trillion to pyramid scams since the collapse of MMM in 2016.
Alaje, in an interview with ARISE News on Thursday, described CBEX as the latest in a disturbing trend of fraudulent schemes exploiting economic hardship and financial desperation.
“Since MMM in 2016, Nigerians have lost approximately 4.8trn to pyramid scam. Pyramid scam is a scheme designed to rip you off of funds. It is only a pyramid scam that promises more interest than the IMF and World Bank put together in a month and sometimes in a week.”
The CBEX platform, which reportedly offered users 100% returns on investments, began experiencing technical issues over the weekend. By Monday, users were locked out of their accounts entirely and in the absence of any official communication from the company, panic quickly escalated into chaos.
In Ibadan, enraged investors stormed a CBEX office, carting away items such as chairs, air-conditioners, and even a solar panel. Online, heart-wrenching videos of victims, some in tears, flooded social media, with many pleading for answers and the return of their hard-earned money.
Alaje stressed the importance of due diligence before participating in any investment opportunity.
“Before you invest in any scheme, apart from the Corporate Affairs Commission certificate they would show you, ask them for a Securities and Exchange Commission license. If they don’t have that, they must have a Central Bank license. And make sure you verify,” he advised.
He warned that unrealistic promises of high returns are a red flag. He said “In this economy, when the promises are too good and excellent to be real, please have a second thought.”
Alaje also pointed out that the CBEX saga creates broader risks for legitimate investment firms. “This can cause industry risk for genuine people who are doing the right thing,” he said. “From history, I doubt everyone will get their money back, but I trust that the EFCC will do its best.”
The Securities and Exchange Commission (SEC) had earlier confirmed that CBEX is not registered with the agency. Emomotimi Agama, the SEC’s Director-General, said on Arise Xchange that any unregistered investment scheme is considered illegal under Nigerian law.
“For us at the SEC, our primary responsibility is investor protection, and investor protection stems out of registration and regulation,” he said.
“When a scheme is not registered with the SEC, it becomes illegal; and it is important that whoever is interested in investing in such a scheme must ask the question, Are you registered with the SEC?
“If that is not the case, then it is automatically stated and known that such is an illegal activity and will not be condoned even by the SEC.”
Agama added that the commission had no prior knowledge of CBEX’s operations because no formal complaints were filed before its collapse—a pattern consistent with other fraudulent platforms. “Most people try to keep it away from the regulator, only involving a close circle of friends,” he said.
The economist however stated his belief that despite the chaos, those behind CBEX can still be traced. “I don’t think the identity of those that own CBEX can disappear anywhere. Financial transactions were involved. Which accounts were paid to.
“We have smart security agencies in charge of investigations. I know that they can do it if they want to do it. That business must have been registered with corporate affairs commission. We can do CAC search and get the names and all,” he said.
He urged victims to assist in ongoing investigations by reporting details of their transactions.
“People need to come out to report officially and also help agencies of government in this regard to mention who they paid and how the payment was made.”
Looking ahead, Alaje called on government agencies to take proactive steps in financial education.
“You need to increase public awareness on investment risks,” he said. “You can engage and put adverts on credible organisations so that young people and old are listening across the board. Most importantly, you need to translate it into other major languages like pidgin English for people to know.”
