SEC Warns Against AI-generated Investment Scams in Nigeria

The Securities and Exchange Commission (SEC) has issued a warning about the emergence of artificial intelligence (AI)-driven scams that are targeting unsuspecting investors with false promises and fake celebrity endorsements. Platforms like CBEX, Silverkuun, and TOFRO have been identified as operating illegally by promoting AI-based trading systems with unrealistic returns.

These unregistered platforms pose significant risks to investors, prompting the SEC to issue disclaimers against their activities. Fraudsters are leveraging deepfake videos and AI-generated content to present fabricated endorsements and testimonials that appear legitimate. By utilizing manipulated videos of politicians, celebrities, and TV personalities, scammers are creating false credibility for their platforms through Facebook ads, Instagram reels, and Telegram groups.

To combat this rising threat, the SEC is implementing advanced surveillance systems capable of detecting fraudulent activity in real-time. Collaboration with the Central Bank of Nigeria (CBN) and the Nigerian Financial Intelligence Unit (NFIU) is being strengthened to facilitate data sharing and coordinated enforcement actions. The shift towards predictive oversight is viewed as a crucial strategy to combat fraud and systemic risks within the market.

The SEC has also engaged social media companies to crack down on misleading ads and cautioned influencers against promoting unlicensed investment schemes. Any influencer found promoting illegal platforms may face regulatory sanctions or prosecution. Nigerians are advised to exercise caution before investing, especially in schemes that promise daily profits, zero risk, or celebrity endorsements.

Investors are urged to verify the registration status of any investment platform on the SEC website, where a list of licensed Capital Market Operators is available. It is essential to confirm that registration numbers displayed on company websites match the details on the SEC portal and to avoid platforms operating solely through Telegram or WhatsApp without a valid office address. The need for tech-enabled regulation and heightened public awareness is emphasized in light of these AI-generated investment scams.

The SEC warns against any investment promising unrealistic returns and advises the public to scrutinize platforms using manipulated videos featuring public figures. With an increase in AI-driven scams, there is a pressing need for proactive measures to protect investors from falling victim to fraudulent schemes. By staying informed, verifying investment opportunities, and being cautious of unrealistic claims, Nigerians can safeguard their finances and avoid falling prey to AI-generated investment scams.