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Uwaje: Africa becoming lucrative catchment area for online schemes


Chris Uwaje

Former President, Institute of Software Practitioners of Nigeria (ISPON), Chris Uwaje, in this interview with ADELOWO ADEBUMITI, warned that venturing into the online money-making arena is akin to swimming in a sharks infested ocean.

Online moneymaking schemes appear to be the in-thing now. How realistic are these offerings that many Nigerians are embracing?
First, Let me thank The Guardian for researching into this matter, which is fundamental to our economic development and real investment. It is therefore important to note the critical keywords such as ‘online, money, payment’ most of which are centered on illusory wonder-bank schemes, and in particular, they all exist in cyberspace/the Internet hence without physical, traceable addresses. This in itself is an unconventional method, which is against the principle of financial mediation, popularly known as banking.

In my opinion, the lure to engage in online moneymaking schemes may be related to the structures and lapses in our banking system, which in itself is long-term investment rather than short-term quick monetary returns.

However, in clear terms, online quick money activities can best be described as self-induced gambling. Simply defined, gambling could apply just as well to investing and vice-versa. Gambling, which is simply to ‘to bet on an uncertain outcome, or to take a risk in the hope of gaining an advantage or a benefit.” To invest on the other hand means ‘to commit money or capital in order to gain a financial return.” Therefore, victims of online quick money transactional activities should first be consciously aware that they are entering into the gambling ocean infested by hungry sharks.


Should Nigerians be wary of participating in some of these schemes?
Absolutely yes. There is a critical need for massive public advocacy and awareness on the numerous connected rivers of online investment and payment systems, which now form a large invisible ocean in cyberspace, largely for feeding on the ignorance of the uninformed.

For example, WealthCon, an online investment/payment scheme) says that it is ‘an agent that links your little investment and contributions to the bigger company who pays you back in huge returns.’ Which agent? Not mentioned at all. This casts an element of doubt as the hidden identity smacks of deceit from the onset. Also, the founder gives his name as RobertWealth, without a surname, and proclaims/promises ‘huge payment in 14 days.

Most of these online payment sports adopt and use similar shades of tricks and tactics, such as ‘invite and crown 20 members to invest N20, 000 and earn N100, 000 in 14 days! Payments would be in three installments.’

Contacts are also always ambiguous. For instance, WealthCon gives Dubai address with Nigerian phone number, while the Nigerian address has no phone number. Some of the dangers are that their websites collect millions of data types, which form a huge database that are certainly applied and used for other hidden purposes.

Official search would reveal that most, if not all of those trading platforms are not registered with the Corporate Affairs Commission (CAC), or any credible internationally accredited corporate entity.

The urge to make quick, lucky money is huge worldwide and that is why psychologists recommended the establishment of more transparent national lottery schemes.

Ponzi schemes, which got their names from Charles Ponzi, who made an elaborate scam in the 1920’s, have been around for a very long time. It is also important to note that online quick moneymaking schemes thrive on peoples’ emotions, desperation, and lack of awareness. For example, in spite of several warnings of the hidden agenda of almost all online money schemes, people are always ready to invest in them. MMM Global came to Nigeria as Mavrodi Mundial Moneybox. It promised customers 30 percent increase on whatever amount they invested. The interesting thing about MMM is that even though reports were abound of how it scammed members in other countries of the world, including African countries, people were still participating, hoping to cash-out before it crashes, which eventually happened in December 2016.

Over N11b was lost to MMM in 2016, is it not becoming an addiction if Nigerians have not learnt lessons from that episode?
Making quick money is an addiction, especially at a time when the world’s population is now estimated to be 7.4 billion, surging at a very fast rate, and globalisation of money and economy has become a done deal. Today, the urge to make quick lucky money is huge worldwide. However, we must note that online quick money issues are also a rights issue. Since its available on the Internet, many uninformed still believe that it is legal and acceptable.

There must be some genuine moneymaking opportunities online, including some floated by Nigerians. Or do you consider all of them new approaches to defraud people?
The question to ask is, are those financial mediator moneymaking windows legitimate, officially registered and accredited by the Central Bank of Nigeria? Many online quick money returns activities are based on orchestrated deception carried out for the purpose of achieving personal gains, while causing injury to another party. A typical example is selling a new security issue while intentionally concealing important facts related to the processes and damages.

Usually, originators of these schemes exist as individuals on laptops with false, or hijacked Internet Protocols (IPs), while the expert groups are organised as syndicates. Financial addiction represents another layer of emotional state of mind of a victim, who believes in making quick money by hook or crooked means.

Let’s remembers that about 15 years ago, wonder banks were awash in Nigeria and millions of Nigerians bought the idea of a bogus investment that promised to, or granted them up to 30 upfront, from the money that depositor/investor brought to them. Once an investor invests his/her cash money and receives 30 upfront, the magic becomes real, but sooner than later, those upfront-returns wonder banks collapsed and Nigerians lost billions of their hard-earned money.

Later came MMM, which became so popular to the alarming extent that the Central Bank of Nigeria (CBN) officially cautioned Nigerians of its fraudulent implication before it crashed. But even at that, millions of Nigerians were hooked on the scheme and lost billions. It is deeply worrisome that in spite of the monumental loss to Nigerian investors; no one or group was prosecuted both nationally and internationally.

How can people recognise genuine offerings and what are those things to look out for when assessing them?
This can be done by scrutinising their offering policies, agreements, and assurances propositions. Also, by verifying their correspondent banks, list of owner/directors, related physical address/location, authentic IP addresses from ICANN (all online activities happen in a physical location/address, but fraudsters hide this from their contacts.

Meanwhile, financial fraud is as old as humanity and has lately been magnified worldwide due to the emergence of the Internet. This has moved financial conmen and women into online money swindling activities, and there are ferocious oceans of online money fraud just as there are victims waiting to be swallowed. African economy and Africans in particular have become the new preferred destination for online easy money activities. And there are many reasons for this.

For instance, the Internet technology is relatively new to Africa and African participants; family insecurity fueled by exponential growth of Africa’s population (about 1.3 billion people) with a large youth concentration; externally induced/ artificial wars; poor governance on distribution of national resources, educational factors such as low literacy, which provides opportunities for conmen to swindle their victims; low awareness on implications of contents available on the digital space; technophobia and excessive consumption of information overload and many more.


Due to these factors, Africa has become the new and lucrative catchment area for online money fraud as witnessed by the MMM scheme, which caused billions of massive economic damage to African economy and families.

What your advise to those addicted to online investments?
The dynamics of what we know, use and call money today has drastically changed. The global financial ecosystem has been disrupted by Information and Communications Technology (ICT) intervention. Crypto currency, electronic money such as Bit coin have emerged globally and many other variations are incubating. Indeed, Facebook with about 2.7 billion subscribers in its combined database comprising Facebook, WhatsApp and Instagram plans to float digital currency of its own. When ready, banks, credit card companies will be on fire on how to respond. This means that invisible sharks would infest the online money ocean and there is need for future investors to be extremely careful.

Having said that, the online money, digital currency and similar instruments and mediums for global economy transaction are unstoppable! Going forward, it is advisable and important to establish if the online money entity is licensed; has accredited correspondent banks and physical operations presence (verifiable address, telephone numbers, emails etc). It is also important to search online for testimonies of victims of online financial scam. Better still, it is best to consult an investment consultant and extract an undertaking that what you intend to get into is fraud-free and you guaranteed against losing your money.

Some indicators of fraudulent online money activities include, but not limited to the promise to use personal account to receive large sums of project/contract money transfer and receive huge compensations that really do not exist; bogus policy claims and false testimonies of invisible customers. Others are high-volume account activity involving domestic transfers through unlicensed firms; the use of false identification and false information to obtain funds through financial lenders, as well as requests for online loan and settlement cheques issued under multiple false names; financial transactions inconsistent with established profile; operation of bank accounts in multiple states and location of residency, and dealing with firms with profile of large-value gaming activity with no threshold transactions.


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