Digital Assets Fraud Threatens Market Integrity – SEC DG

The Director General of the Securities and Exchange Commission (SEC), Dr. Emomotimi Agama, has raised concerns about the growing threat posed by digital asset-related fraud, stating it endangers the integrity of Nigeria’s capital markets and undermines investor trust.

Speaking at an event in Abuja to mark African Union Anti-Corruption Day, themed “Understanding Virtual Assets and Investment Fraud,” Agama emphasized that corruption, including virtual asset fraud, remains a major obstacle to economic development and investor confidence in Africa.

He highlighted the rise of fraudulent schemes exploiting digital innovation in financial systems, warning that such scams erode trust and redirect resources away from sustainable development.

Agama noted that the recently enacted Investment and Securities Act (ISA) 2025 provides regulatory clarity for virtual assets, establishing SEC as the lead regulator for digital tokens and blockchain-based assets classified as securities or investments.

Under the ISA, all Virtual Asset Service Providers (VASPs) — including exchanges, brokers, and custodians — must register with SEC and meet standards in capital adequacy, cybersecurity, and corporate governance. Platforms are also required to disclose risks related to volatility, fraud, and regulatory uncertainty.

The SEC chief reaffirmed the Commission’s commitment to investor education, improved oversight, and regional cooperation to address financial crimes and illicit flows involving virtual assets.

In his remarks, Chairman of the Economic and Financial Crimes Commission (EFCC), Mr. Ola Olukoyede, echoed the warning, describing virtual asset scams as a fast-emerging threat to national economic security that could soon outpace traditional money laundering activities.