Why Nigerians opt for fraudulent investments – Expert

An innovator, Mr Dayo Ayeni, says high rate of inflation, economic hardship and greed are some of the reasons some Nigerians fall victims of fake investment and online trading.

Ayeni, Chief Innovation Officer, BusinessPlus Ltd., in an interview with the News Agency of Nigeria (NAN) on Wednesday in Lagos, said that owing to these vulnerabilities, Nigerians were increasingly targeted by investment fraudsters.

He said that with the high rate of inflation in the country, low income earners in Nigeria look for easy ways to double their income, hence they take to these investment scams.

Ayeni said that some of the perpetrators of these henious acts sometimes promote adverts on social media with a promise of higher returns.

“Most people initially receive unrealistic returns from these firms to give the impression that their trading has been a success.

“They will then be encouraged to invest more money or introduce a friend or family member and eventually the returns stops. Customers’ account are suspended and there’s no further contact with these firms,” he said.

According to him, these scammers prey on people’s trust and greed to strip them of their life savings and victims are thrown into perpetual poverty, while those that borrowed money to key into these schemes become indebted.

“Many people get into these investment scams with unrealistic returns, knowing it is a fraud. This is with the hope that they are early enough to make some profits before it crashes,” he said.

He said that a lot of Nigerians had lost millions of Naira to ponzi schemes and investment scams as a result of ‘get-rich-quick’ syndrome.

Ayeni said that the high number of investment fraud cases shows that Nigerians are not risk-averse.

According to him, to avoid falling victim to fraudulent investment schemes, it is imperative to check the body regulating the investment company, and ensure it is registered with the Securities and Exchange Commission.

Ayeni said that one could also spot an investment scam once a firm uses pressure tactics, ranging from limited offers to timed gifts or rebates.

He also noted that one should always be suspicious of any investment opportunities that promise a high return with little or no risk.