The news of CBEX — the latest Ponzi scheme — crashing, leaving thousands of Nigerians in financial distress, is not a unique story.
It follows a well-known pattern. The names change, the methods evolve, but the outcome remains the same: investors lose their hard-earned money.
From the infamous MMM to MBA Forex, from Loom Money to Let’s Farm, Ponzi schemes have plagued Nigerians for years, leaving behind shattered dreams and broken finances.
Here’s an in-depth look at some of the most infamous Ponzi schemes in Nigeria, how they operated, and why so many Nigerians still fall victim to them.
What is a Ponzi Scheme?
A Ponzi scheme is an investment scam that promises high returns with little to no risk. It works by paying early investors returns from the funds of newer investors rather than from legitimate profits.
As long as new investors keep joining, the scheme continues to operate. But once the flow of new investors slows down, the whole structure collapses, and the majority of participants are left with nothing.
The name “Ponzi scheme” comes from Charles Ponzi, who ran such a scam in the 1920s, though many other schemes have followed his model.
Notorious Ponzi Schemes in Nigeria
1. MMM Nigeria (2016)
In 2016, MMM Nigeria promised investors up to 30% monthly returns. The platform was marketed as a “peer-to-peer donation scheme,” where members could help others by “donating” money and receive returns from other participants. At its peak, MMM Nigeria had over 3 million active users, and estimates suggest that ₦18 billion was lost when the scheme collapsed in December 2016. Founder Sergey Mavrodi’s arrest in Russia was followed by the sudden disappearance of the platform, leaving millions of Nigerians stranded.
2. MBA Forex (2019–2021)
MBA Forex promised returns of 15–20% monthly through forex trading. It was presented as a professional forex trading firm, complete with flashy marketing materials and seminars. Investors who believed the hype lost ₦171 billion when the scam was exposed. The founder, Maxwell Odum, was later arrested, but many victims were left with little recourse to recover their funds.
3. Loom Money (2019)
The Loom scam spread like wildfire on social media, especially WhatsApp and Facebook. Investors were promised up to 8x returns for as little as ₦1,000 by participating in a “peer-to-peer” investment. The process involved inviting friends to join, and when enough new investors were brought in, the original participants would receive their promised returns. The scheme folded quickly, leaving many with nothing. The SEC issued warnings, but by the time it collapsed, many had already lost their money.
4. Let’s Farm (2020–2021)
Let’s Farm marketed itself as an agricultural investment platform, claiming investors could earn returns from farming ventures. However, the platform was fake, and the promised profits were never delivered. After disappearing in 2021, Let’s Farm left investors with empty hands. The platform operated without any real agricultural operations, and its business model was entirely based on recruitment.
5. Bara Finance (2020)
Bara Finance operated as a trading and investment platform and promised consistent returns from trading stocks, forex, and other assets. Its unlicensed status and the eventual court conviction of its promoters exposed it as a scam. Investors who had trusted Bara Finance were left high and dry when the platform abruptly shut down, with no refunds issued.
6. LPV Forum (2023)
LPV Forum was a task-based Ponzi scheme that disguised itself as a digital “task engagement” platform. It promised users daily earnings for completing simple actions like reposting links, liking content, and joining groups — essentially farming engagement on social media.
To access higher earnings, users were required to pay for “VIP levels,” creating a classic Ponzi structure where new users’ payments funded earlier participants. There was no actual product or investment behind the platform. When it eventually shut down, many Nigerians who had bought into the illusion of easy money were left with nothing.
7. Bet88 (2023)
Bet88 emerged as a sports betting platform, but it promised impossible returns on daily bets. It claimed to offer guaranteed winnings, which in real betting is impossible. Participants were lured in with promises of fixed daily earnings, but the platform went dark when it folded. Users were locked out of their accounts, with their funds inaccessible.
8. Otto (2023)
Unlike the others, Otto was marketed as an online product investment platform where people could purchase goods and earn returns from reselling them. However, Otto was a classic Ponzi scheme, as there were no actual products involved. The business model relied on referrals and recruiting new members. It was exposed as a scam in 2023, and those who had invested in “products” were left with nothing.
9. CBEX (2025)
Finally, we arrive at CBEX, the most recent Ponzi scheme to affect Nigerians. CBEX promoted itself as a crypto AI platform that used bots for trading. Influencers on social media helped promote the scheme, and many Nigerians were drawn in by its promises of lucrative returns.
However, a few weeks ago, the platform just shut down, leaving its investors with no way to recover their funds.
Recognising the Patterns of Ponzi Schemes
Despite the different names and methods used, these schemes share several key characteristics:
- Too-good-to-be-true returns: Ponzi schemes promise extraordinary returns with little to no risk.
- No clear business model: The operations are vague, and the profits come from new investors rather than legitimate business activities.
- Recruitment-based growth: New participants are encouraged to recruit more investors, often with the promise of bigger returns.
- Social media promotion: Ponzi schemes heavily use social media to spread their message, often using “proof” of large returns to entice new investors.
- Sudden disappearance: When the flow of new investors slows down, the scheme collapses, and the organisers disappear.
Why Nigerians Keep Falling for Ponzi Schemes
Economic Hardship
Nigeria’s difficult economic conditions have driven many people to seek quick financial solutions. The high cost of living, inflation, and unemployment make it tempting for Nigerians to turn to schemes that promise easy money. Ponzi schemes exploit this desperation by offering a way out of financial hardship, which, sadly, is often too good to be true.
Lack of Financial Literacy
Many Nigerians are unfamiliar with how investments work and how to spot fraud. Financial education remains low, and most people don’t understand key concepts like risk, diversification, and compound interest. Without this knowledge, it’s easier to fall for scams.
Herd Mentality and FOMO
When everyone in a community is talking about how much they’ve earned, fear of missing out (FOMO) takes over. People are more likely to join Ponzi schemes when they see friends, family, and celebrities posting about their “success.”
Trust Issues with Traditional Financial Institutions
Many Nigerians lack trust in traditional financial systems due to the instability of banks and a history of poor governance. This scepticism leads some to turn to unregulated, online platforms where they feel they can get quicker returns.
Conclusion and Warnings
Ponzi schemes continue to flourish in Nigeria, with newer ones popping up every year. CBEX is just the latest example of how these scams prey on Nigerians’ desperation for financial freedom.
But there’s hope — we can break this cycle if we stay vigilant and educate ourselves. Here are some tips to protect yourself:
Be contented — All that glitters is not gold.
Avoid investments that promise guaranteed returns — No investment is without risk.
Do your research — If something sounds too good to be true, it probably is.
Check for regulation — Only invest in platforms that are registered with the Nigerian Securities and Exchange Commission (SEC) or the Central Bank of Nigeria (CBN).
Understand the business model — If you don’t know how the company is making money, it’s likely a scam.
