The Investments and Securities Tribunal (IST) has introduced strict penalties for individuals and firms found guilty of running Ponzi schemes, with a minimum fine of ₦10 million now mandated by law.
According to Investments and Securities Tribunal (IST) Chairman, Amos Azi, this provision is part of the newly enacted Investments and Securities Act, which aims to restore trust and protect investors within Nigeria’s capital market.
Speaking at a stakeholders’ engagement event in Abuja, Azi emphasized the critical role this legal update plays in curbing fraudulent investment activities. “The inclusion of monetary penalties in the current Act is a crucial step in deterring illegal investment operations that have undermined trust in the financial system,” he said.
The 2007 version of the Act had no clear sanctions for Ponzi operations. The new law corrects that gap, offering stronger protections and a more defined legal framework to hold offenders accountable.
IST Moves to E-Filing by July 2025
During the engagement, Azi also announced the introduction of the Tribunal’s electronic filing (e-filing) platform, set to launch in July 2025. The move is expected to eliminate physical filing entirely.
He explained that the shift is more than a digital transition—it is designed to streamline case handling, improve transparency, and ensure timely dispute resolution in the financial sector.
“The purpose of this stakeholders’ engagement is to ensure that members of the legal community are fully equipped with the knowledge required to navigate the new e-filing system. It is imperative that we all adapt quickly to these changes,” Azi added.
Digital Assets Recognized in New Act
The updated Act extends beyond sanctions on Ponzi schemes. It introduces several progressive elements, including the formal recognition of digital assets and cryptocurrencies as securities under Nigerian law. These reforms allow the establishment of virtual exchanges and broaden the Tribunal’s jurisdiction to include digital asset-related disputes.
Legal practitioners and market players are expected to align with these changes. The Tribunal’s expanded mandate will also work through the current complaint management framework to ensure order in the evolving digital space.
Legal Community Welcomes the Reforms
At the Abuja event, Owhor Clever, Chairman of the Nigerian Bar Association (NBA), Gwagwalada Branch, urged the Tribunal to widen its training scope to benefit all interested members of the legal community. This, he said, would ease the transition to digital proceedings and ensure practitioners are well-prepared to support clients.
The event saw participation from legal stakeholders in Abuja, Port Harcourt, and Enugu, both virtually and in person.
Article updated 3 weeks ago. Content is written and modified by multiple authors.
