5 Reasons More Individuals Fall Victim Of Fake Investment Schemes

The second quarter of the year 2022 just started and is still in its first month but has been filled with lots of news about one failed investment scheme or the other. It appeared to be a week in week out occurrence as the Nigerian news space has been kept agog with tales of anguish being shared by individuals who have been victims of the various failed schemes. The high number of these failed schemes and the high number of persons involved leaves one wondering why more and more persons keep falling victims.

Lack Of Adequate Information

This is probably the most important reason why individuals keep falling victims to these schemes. It appears that the number of persons who know nothing about finance and investment is higher than those who do. And it is always these individuals who do not have adequate knowledge of investments and finance that easily fall victims to these schemes.

Fear Of Missing Out (FOMO)

For some of the victims whom I spoke to, the fears and doubts were there but they chose to ignore them out of fear that could be missing out on a great investment opportunity. A friend of mine who invested close to 2 million Naira in one of the platforms told me that he had his suspicions but feared that he may be losing out on an opportunity of a lifetime if she did not invest in it.

Influence Of Trusted Persons

All of the investment platforms seem to have the same strategy for promoting their schemes and attracting subscriptions. They engage the services of popular social media influencers and other celebrities that they know have a huge following of people that could easily be convinced to buy into the schemes.

It may sound insensitive or rather harsh to consider greed as one of the reasons why some individuals fall victims to these failed investments. However, when you consider the nature of these investment schemes, the promises of high returns on investment and other material benefits, it leaves you to wonder whether if not greed what else it could have been. For instance, one of the investment platforms promised its subscribers a 100 percent return on their investment within the first three months and a chance for a trip to Dubai after one year.

Ineffectiveness of Regulatory Agencies

When you carefully consider the fact that most of these investment schemes and platforms did not just spring up and disappear in one day, you begin to wonder how effective the various regulatory agencies in Nigeria are in keeping the Nigerian investors safe from fraudulent investment platforms. One would have expected that the various regulatory agencies would have improved systems of tracking these platforms and also keeping the public aware of their existence.

With the number of fraudulent investment schemes or platforms springing up every day, there is a need for all stakeholders within the financial sector to devise more proactive means of checking this. Also, individuals must do their part in ensuring they improve their financial intelligence.