The Nigerian Senate has launched an investigation into the growing spread of Ponzi schemes, following the collapse of the Crypto Bullion Exchange (CBEX), which allegedly defrauded investors of over ₦1.3 trillion.

The decision came after a motion by Senator Adetokunbo Abiru (Lagos East), who expressed concern over the persistence of fraudulent investment platforms like MMM Nigeria in 2016, MBA Forex in 2020, and most recently CBEX, which promised high returns through digital asset investments.

During debate, lawmakers said the collapse of CBEX had resulted in severe financial losses, emotional distress, and even suicide among victims. Many pointed to regulatory failures as a key factor in the unchecked operation of such schemes.

Senators noted that despite CBEX’s widespread online presence and activities, agencies like the Securities and Exchange Commission (SEC), Central Bank of Nigeria (CBN), Nigerian Financial Intelligence Unit (NFIU), and Economic and Financial Crimes Commission (EFCC) failed to act in time to protect investors.

The Senate has mandated a joint committee to investigate the circumstances surrounding the rise of Ponzi operations, with a public hearing expected in the coming weeks. The committee is expected to submit its findings within a month.

The EFCC had previously warned Nigerians against such schemes. In March, it released a list of 58 companies suspected of operating Ponzi schemes.

In April, Justice Emeka Nwite of the Federal High Court, Abuja, granted the EFCC’s request to detain six promoters of CBEX over alleged fraud totalling over $1 billion.

The EFCC’s motion, filed by counsel Fadila Yusuf, sought court approval to arrest and remand the suspects while investigations continued. The Commission said the detentions were necessary to complete its inquiry and prepare for possible prosecution.