The Securities and Exchange Commission (SEC) has issued a cautionary alert to Nigerians regarding a surge in scams fueled by artificial intelligence (AI), which are deceiving investors with false promises of guaranteed returns and counterfeit celebrity endorsements.
In a statement released on Sunday, the SEC highlighted that these fraudulent platforms operate without registration or regulation by the commission, yet continue to mislead the public with deceptive claims about AI-powered investment opportunities. Such activities pose significant dangers to investors, prompting the SEC to release multiple warnings against them.
The commission detailed how scammers are increasingly leveraging AI technologies, including deepfake videos and AI-generated content, to ensnare victims. These manipulated clips, often featuring well-known politicians, celebrities, and media personalities, are disseminated via Facebook advertisements, Instagram reels, and Telegram channels to create a false sense of legitimacy around these fraudulent schemes.
“Fraudsters are harnessing AI to produce fabricated endorsements and testimonials that seem authentic, undermining traditional fraud detection techniques. This situation necessitates the implementation of technology-driven regulatory measures and heightened public vigilance,” the SEC explained.
To address this escalating menace, the SEC is deploying sophisticated monitoring tools designed to identify fraudulent activities in real time. Additionally, the commission is enhancing collaboration with the Central Bank of Nigeria (CBN) and the Nigerian Financial Intelligence Unit (NFIU) to facilitate data exchange and coordinated enforcement efforts.
“Our approach is shifting from reactive responses to proactive, predictive oversight, which is crucial for mitigating fraud and systemic risks within the financial market,” the SEC emphasized.
Furthermore, the regulator has engaged with social media platforms to curb the spread of misleading advertisements and has issued stern warnings to influencers against endorsing unregistered investment schemes.
“Influencers or bloggers found promoting illegal investment platforms will be subject to regulatory penalties or legal prosecution,” the SEC cautioned.
The commission urged Nigerians to exercise heightened caution before committing funds, particularly when confronted with schemes that promise daily profits, risk-free returns, or endorsements from celebrities.
“Investments guaranteeing unrealistic gains or featuring manipulated videos of public figures should be treated with extreme skepticism,” the SEC advised.
Investors are encouraged to verify the registration status of any investment platform by consulting the SEC’s official website, which maintains an updated directory of licensed Capital Market Operators.
Additionally, the SEC recommends confirming that registration numbers displayed on company websites correspond with those listed on the SEC portal and avoiding platforms that operate solely through messaging apps like Telegram or WhatsApp without a verifiable physical office address.
