Anti-fraud Experts Caution against Quick, High Investment Returns

 Omolabake Fasogbon

Investors have been advised to take extreme caution regarding investment opportunities that promise rapid and exceptionally high returns.

Experts gave this advice during the Association of Certified Fraud Examiners (ACFE) Southwest Nigeria Chapter’s  virtual training for anti -fraud professionals and investors, themed, ‘Ponzi and Pyramid Schemes: Red Flags& Protection.’ They warned that such opportunities are often hallmarks of fraudulent operations. 

Management expert/ Chairman, Board of ACFE,Southwest Nigeria Chapter, Prof. Godwin Oyedokun, expressed concern on rising investment scams and Nigerians’ vulnerability, citing CBEX collapse and the floating of  similar scheme, almost immediately after CBEX trauma. 

According to him, it was important that investors guard themselves ahead with early warning signs to avoid victimization and financial loss. He listed some red flags as high, consistent returns, secretive strategies, complex explanation and pressure tactics. 

Noting that both Ponzi and pyramid schemes share some similar modus operandi like relying on participants’ money to pay earlier investors, promise of unrealistic high returns and  eventual collapse, Oyedokun stressed the need for Nigerians to familiariase themselves with their individual nuances  so to be circumspect. 

He said, “Ponzi schemes disguise as legitimate investments, portray a single investment vehicle, and often claim earnings from fake profits. Pyramid schemes on the other hand emphasize recruitment, require buying-in and lack real products.” 

Oyedokun further cautioned investors against greediness, tasking them on financial education and responsible behaviour. 

Also a facilitator at the training, a Forensic Accountant, Dr. Kennedy Iwundu noted that the ease with which scammers infiltrate systems, challenges fraud examiners to up their game in tackling fraudulent endeavours. 

“A collaborative approach between fraud examiners and lawyers is essential. Together, they can dismantle these schemes and seek justice for victims by tracing funds, identifying irregularities, and providing expert testimony in legal proceedings” , he added. 

Earlier, the president of the ACFE South West Nigeria Chapter, Dr. Lydia Halimat Ajayi remarked that present situation called for more sensitization and knowledge update of both investors and fraud examiner, hence the training. 

“By sharing expert insights and best practices, we aim to create a more vigilant and informed community that can spot and stop these schemes”, she said.