The House of Representatives has passed for second reading a bill to repeal and re-enact the Nigerian Capital market, Investments and Securities Act.
The bill seeks, among other things, to prohibit Ponzi schemes and other pyramid investments.
If the bill finally becomes a law, promoters could face 10 years imprisonment if convicted by the court.
The bill, sponsored by Ibrahim Babangida (APC, Kano), was read the second time on Thursday after a debate on its general principles.
In his lead debate, Mr Babangida informed his colleagues that the existing bill was signed into law in 2007 by the former President Umar Yar’Adua, however, “current trends in capital markets regulation have made it imperative to make major improvements to the Act to align our market with international standards.”
To address the menace of Ponzi schemes, Mr Babangida said the bill seeks to empower the Nigerian Security and Exchange Commission (SEC) to shut down such prohibited investment schemes.
He stated that the bill has adequate provision to enhance efficient regulation of investment schemes and to effectively combat the proliferation of Ponzi schemes in Nigeria.
“The bill prohibits Ponzi/Pyramid Schemes as well as other illegal investment schemes and prescribes a jail term of not less than 10 years for promoters of such schemes,” Mr Babangida said.
Speaking further, he said the bill also seeks to provide legal framework to regulate derivatives and…
