Many Nigerians have been painfully swindled out of millions of their hard-earned money through various scams. Consequently, some victims of these scams have committed suicide, others have been denied prosperity, and many have been left with unpayable debts.
Internet scammers have stolen money from people; Ponzi schemers have defrauded numerous Nigerians of their cash, just as dubious and unregistered financial service operators have ruined countless financial nests.
The destructive nature of Ponzi schemes, in particular, was highlighted by Dr. Okey Umeano of the Securities and Exchange Commission (SEC) in an edition of Accounting and Business (AB) magazine, where he wrote:
“Ponzi schemes in Nigeria have collectively cheated citizens of an estimated US$1bn (₦1.5 trillion).”
The Ponzi schemers succeeded largely, he noted, “because people fail to recognise them for what they are – fraud.”
The Central Bank of Nigeria’s (CBN) Financial Stability Report for 2024 indicated a nearly 50 per cent increase in cases of financial fraud. Up to 70 per cent of losses occurred through digital channels and unregulated platforms.
The Securities and Exchange Commission has also cautioned the investing public against doing business with more than 30 identified Ponzi investment schemes.
The Economic and Financial Crimes Commission (EFCC) stated in its 2021 report that its prosecution of financial crime suspects led to the conviction of 2,220 offenders — proof that fraud of various types is widespread in the country.
In its January to June 2025 operational report, the EFCC said it arrested 1,427 suspected internet fraudsters. These “Yahoo boys” use the internet to defraud people and often flaunt their stolen wealth by buying luxury cars, expensive vans, and living in exotic houses and hotels.
Sadly, empirical evidence indicates that no financial institution or system in the world has an absolute and airtight mechanism against fraud — not even central banks.
In 2015, six officials of the Central Bank of Nigeria and sixteen staff of commercial banks were arrested by the EFCC for allegedly stealing ₦8 billion worth of defaced and mutilated Nigerian currency notes meant for destruction.
Similarly, UK Finance — the collective voice for the banking and finance industry in the United Kingdom — said in its latest annual report that:
“Fraud continues to pose a major threat, with over £1 billion stolen through payment fraud in 2024.”
There were 3.13 million reported fraud incidents during the period.
“Criminals stole £1.17 billion through unauthorised and authorised fraud in 2024, while banks prevented £1.45 billion of unauthorised fraud through advanced security systems,” the report added.
It is within this context of safeguarding against fraudulent activities in banks and other financial institutions that the recent advice by the Managing Director of the Nigeria Deposit Insurance Corporation (NDIC), Dr. Oludare Sunday, becomes apt. Nigerians should listen to him and heed it.
Dr. Sunday advised Nigerians, during the 2025 Abuja International Trade Fair, to stay away from banks and other financial institutions not licensed by the Central Bank of Nigeria and to refuse to patronise any bank, fintech company, or payment service provider without NDIC insurance coverage.
He gave this caution because the NDIC is statutorily responsible for maintaining financial stability — by preventing bank failures, detecting and halting suspicious transactions, and insuring deposits in banks to protect depositors from bankruptcy should any insured financial institution fail. The NDIC insurance cover guarantees the reimbursement of depositors’ funds up to specified limits.
To prevent bank failures, the NDIC rigorously supervises, monitors, and regulates financial institutions to ensure their soundness and effective risk management systems. This provides assurance of safety for depositors, promotes financial stability, and sustains public confidence in the banking system.
It is also significant that the Chartered Institute of Bankers of Nigeria (CIBN) and the NDIC have recently agreed to deepen cooperation in digital banking, cybersecurity, fraud prevention, and risk management.
Salisu Na’inna Dambatta wrote from Abuja.
