It has not been a pleasant week for thousands of Nigerians who have again fallen for another money scam.

According to DUBAWA, a West African independent verification and fact-checking project, several persons on various social media platforms have begun to count their losses as CBEX, a popular digital asset trading platform, reportedly wiped out over N1.3 trillion from Nigerian investors’ accounts.

The platform collapsed after funds disappeared from users’ wallets, withdrawals were postponed, and communication channels were locked.

Taiwo Owolabi, a security analyst, recently released an analysis showing how investors’ funds were diverted through funnel wallets and finally into a central wallet, which now holds a total of $857 million in USDT.

The security expert concluded that CBEX was just another Ponzi scheme.

When CBEX promised a mouth-watering 100 per cent return on crypto investments in 30 days, many Nigerians rushed to invest just like they did with the defunct MMM.

However, despite the crash, CBEX has asked some investors to pay $100 and $200 verification fees to access partial withdrawals.

Now that the chips are down, it’s time to ask: “How did we not see this coming?”

Below are four red flags about CBEX that investors ignored.

1. No regulatory approval

CBEX operated without registration or approval from the Securities and Exchange Commission (SEC) or the Central Bank of Nigeria.

Still, many Nigerians invested, assuming legitimacy because the platform looked flashy. This has become a pattern, as in previous cases where Nigerians got duped, the platforms were unregistered.

SEC has since warned Nigerians against investing in unregistered online forex and digital asset platforms, saying that operating such businesses without registration is now illegal under the new Investment and Securities Act (ISA).

Lesson: Always verify a platform’s regulatory status before putting your money in. 

2. Anonymous founders

CBEX’s website and Application did not list identifiable owners or executives. To gain credibility, CBEX masqueraded as a crypto platform, talking about “blockchain,” “trading bots,” and “AI-powered systems.” However, it had no verifiable trades or links to legitimate crypto exchanges. It used tech jargon to mislead its users.

Lesson: Transparency is a minimum requirement. If you don’t know who runs it, don’t trust it.

3. Unrealistic returns on investment, withdrawal issues

While there is no ideal return on investments (ROI), excessively high ROIs or ones that appear too good to be true are usually a call for caution.

CBEX promised investors returns of up to 100 per cent in 30 days. That looks like a classic Ponzi red flag.

As seen in the past, these kinds of returns are unsustainable, but they remain effective bait that can appeal to anyone’s greed.

At first, CBEX worked. Users were getting paid even though Owolabi claimed the platform initially used one investor’s money to pay another until it could not.

Just before the crash, many users reported delays in withdrawing their funds. CBEX blamed this on “system upgrades” and “network issues,” which is a tactic common with failing schemes.

Lesson: High, guaranteed returns are a red flag, and consistent withdrawal delays indicate that the system is drying up. That’s usually when the exit strategy begins.

4. Influencer endorsements and peer pressure

The Fear Of Missing Out (FOMO) does not respect age, especially when influencers, friends, and families are involved. However, the misuse of trust through misinformation is common in fraud schemes.

CBEX’s biggest marketing weapon was social media hype and word-of-mouth pressure. The platform relied heavily on trust networks.

From WhatsApp statuses to Facebook pages and TikTok videos, CBEX grew viral through a coordinated network of testimonials. People shared real and fake proof of payment screenshots and emotional success stories.

When friends and family members innocently vouched for it, people ignored other red flags and pumped money into the scheme.

Lesson: Social proof is not due diligence. Always investigate platforms independently, even if people you trust are involved.

Conclusion

CBEX’s collapse is not new; unfortunately, it may not be the last. DUBAWA urges investors to adopt a fact-checking mindset when approached with financial opportunities. Scams thrive on ignorance and trust. Our best defence is verification, not hope.

DUBAWA is a West African independent verification and fact-checking project, initiated by the Centre for Journalism Innovation and Development (CJID) and supported by the most influential newsrooms and civic organisations in West Africa to help amplify the culture of truth in public discourse, public policy, and journalistic practice.

It has a presence in Nigeria, Ghana, Sierra Leone, Liberia and The Gambia.

Central Bank of Nigeria (CBN) approved the application of Ascensia Finance Company Limited to operate as a finance company in the country.

The apex ban however warned Ascensia it could revoke her license over regulatory breaches, false claims.

The final approval was conveyed in a letter dated April 10, 2025, and signed by Dr. Abubakar Shebe, on behalf of CBN Director, Financial Policy and Regulation Department.

The apex bank stressed that the approval was granted subject to strict adherence to the provisions of the CBN Act 2007, the Banks and Other Financial Institutions Act 2020, and rules and regulations issued by CBN from time to time.

CBN warned that “failure to abide by these laws and regulations may be grounds for revocation of your licence”.

The central bank further stated that any adverse report on any of the board members or management staff will invalidate his/her appointment and might negatively affect the finance company.

The letter also stated that any false claim on the basis of which the approval was granted will render the authorisation invalid.

CBN mandated the finance company to inform the bank of the date of commencement of operations to enable the former to update its records accordingly.

CBN added that the licence (certificate) for the finance company will be issued in due course.

Commenting on the license approval, Mr. Jude Ezeamii, managing director/chief executive, Ascensia Finance Company Limited, said the company will bring succour to SMEs, local corporates and self-employed professionals, and salaried employees in both the private and public sector.

Ezeamii said that would be achieved through creating workable access to sustainable financing, which businesses required to meet their business needs.

A seasoned banker with extensive retail and commercial banking experience, Ezeamii, assured that the company will redefine SME financing in the country by leveraging technology to deploy financial services across the area councils in Abuja, and major cities across Nigeria within the first two years of operation.

Nelson Omanibe, chairman of the company, said on commencement of business the firm will roll out products and services that will support the various initiatives of the current administration to boost the operations of SMEs.

The company was also expected to leverage the expertise of its promoters to boost small businesses, described as the engine room of the country’s economy.

The Securities and Exchange Commission (SEC) is set to collaborate with the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) to implement joint nationwide sensitization campaigns on “Financing SMEs through the Capital Market.”

Director-General of the SEC, Emomotimi Agama, said this during a meeting with SMEDAN in Abuja on Tuesday. He said both agencies would co-brand financial literacy content and SME investment-readiness toolkits.

Agama explained that the meeting aimed to initiate a strategic collaboration between the SEC and SMEDAN to support small business financing through access to the capital market.

The engagement, he noted, aligns with the mandate of the SEC’s newly established Office of Small Business Advocacy (OSBA), which serves as the primary interface between the Commission and SMEs seeking to raise capital via securities issuance.

According to him, SMEs represent over 90 percent of businesses in Nigeria and contribute significantly to employment and GDP.

Despite their importance, most SMEs face major obstacles in accessing long-term, affordable financing.

He said the SEC, through the OSBA, is actively working to broaden access to market-based financing instruments for SMEs.

He noted that SMEDAN, as a statutory stakeholder in the MSME space, has deep knowledge, nationwide networks, and relevant data infrastructure to support SME development.

A collaborative framework between the SEC and SMEDAN, he added, will foster synergies for policy innovation, capacity building, and SME investment readiness.

Agama further disclosed that the Commission seeks to formalize a partnership with SMEDAN to implement coordinated interventions such as secure access to reliable and verified SME data to enable capital market outreach and segmentation, joint use of SME analytics for market readiness assessments and policy insights, and training programmes for SMEs on capital market funding opportunities, governance, and compliance.

He added that both agencies hope to co-host a National SME Capital Market Summit in the third or fourth quarter of the year to showcase financing opportunities for SMEs.

He emphasized the need to harness Nigeria’s entrepreneurial potential through inclusive capital formation, saying, “There will be no economy without the capital market.

“The capital market is the engine room of any economy. The reason companies are not approaching the market is due to lack of funds.

“We are here to change the narrative because we know that SMEs are the backbone of our economy.

By working with SMEDAN, we can create enabling frameworks to help these businesses access long-term funding.”

Also speaking, the SEC’s Executive Commissioner, Legal and Enforcement, Frana Chukwuogor, noted that under the new Finance Act and SEC regulations, small business owners can raise funds through the capital market, either through equity or debt, to grow their enterprises. She added that the capital market can provide the financial boost SMEs require.

In his remarks, the Director-General of SMEDAN, Charles Odii, welcomed the collaboration, describing it as a game-changer for Nigeria’s SME landscape.

He said that the alliance with the SEC aligns perfectly with SMEDAN’s mandate to upscale and formalize the informal sector.

By introducing SMEs to non-traditional funding avenues like bonds, equities, crowdfunding, and other market instruments, he said more businesses can be empowered to scale sustainably.

The meeting concluded with a shared commitment to establish a national working team to streamline SMEs’ onboarding processes for capital market participation, develop targeted investor education programmes, and create innovative financing models tailored to the needs of small businesses.

This partnership marks a pivotal step toward inclusive economic development and is expected to catalyze job creation, industrial growth, and financial inclusion across the country.