The Securities and Exchange Commission (SEC) has formalized a strategic collaboration with the Central Bank of Nigeria (CBN) and the Economic and Financial Crimes Commission (EFCC) to track, monitor, and freeze illicit digital wallets linked to money laundering, fraud, and other financial crimes. The announcement came via a SEC press statement and was further highlighted by SEC Director-General, Dr. Emomotimi Agama, during a lecture at the Abuja Journalists Academy.
In the statement, the SEC emphasized that the partnership marks a critical step in protecting investors and ensuring integrity in Nigeria’s rapidly growing digital finance ecosystem. Dr. Agama, represented by Mrs. Efe Ebelo, Head of External Relations, stated:
“To strengthen enforcement, the SEC is working closely with the Central Bank of Nigeria and the EFCC to freeze illicit digital wallets and recover criminal proceeds. Our goal is to ensure that innovation serves progress, not predation.”
The SEC highlighted Nigeria’s status as one of the world’s leading adopters of digital assets, with over one-third of the population engaged in cryptocurrency and other digital finance activities. While acknowledging the potential of these technologies to drive financial inclusion, the SEC warned that rapid growth has also created opportunities for abuse, including crypto scams, phishing attacks, fake wallet applications, and ransomware schemes.
“Without strong regulation, innovation can quickly become vulnerability. Regulation is not about restriction; it is about building trust and ensuring that innovation strengthens our economy rather than weakens it,” the press statement emphasized.
To mitigate risks, the SEC has implemented a regulatory framework for Virtual Asset Service Providers (VASPs) under its 2022 Rules on the Issuance, Offering, and Custody of Digital Assets, based on three pillars: licensing, compliance, and transparency. The Commission is also deploying blockchain analytics, artificial intelligence (AI), and advanced monitoring tools to trace transactions, detect fraud, and enhance cybersecurity.
“We are leveraging blockchain analytics, AI, and advanced monitoring systems to strengthen our supervisory capacity. This will allow us to respond faster to suspicious transactions and protect market integrity,” Dr. Agama said.
The SEC stressed that collaboration with CBN and EFCC will improve coordination between financial regulators and law enforcement agencies, enabling swift action against cross-border financial crimes. Dr. Agama also aligned Nigeria’s regulatory approach with global standards, citing FATF Recommendation 15, the EU’s MiCA framework, and intensified enforcement in the U.S.
Expert Reactions: Economist and investor Celestine Ukpong described the SEC’s initiative as “a timely and essential intervention” for Nigeria’s digital finance sector.
“By freezing illicit digital wallets and recovering criminal proceeds, the SEC is not only protecting investors but also creating a more credible and stable market. This gives both local and international investors confidence to participate in Nigeria’s digital economy,” Ukpong said.
Peter Adebayo, a chartered accountant, also welcomed the move, highlighting its impact on financial transparency and compliance.
“This collaboration strengthens Nigeria’s anti-money laundering efforts and reduces systemic risk in digital finance. It’s a critical step in aligning local practices with global standards, ensuring accountability and protecting unsuspecting citizens from fraud,” Adebayo noted.
Dr. Agama concluded by reaffirming the SEC’s commitment to building a digital finance ecosystem grounded in ethics, transparency, and trust.
“The future of finance is digital, but its foundation must remain ethical, transparent, and trustworthy. Trust is the ultimate currency, and as regulators, our highest duty is to preserve it,” he said.
The SEC urged fintech innovators, investors, and digital entrepreneurs to embrace responsible innovation, assuring that the Commission’s priority is a secure environment that promotes financial inclusion, protects investors, and contributes to national development.
SEC collaborates with CBN and EFCC to freeze illicit digital wallets in Nigeria. Experts Celestine Ukpong and Peter Adebayo laud the move, highlighting investor protection, regulatory compliance, and financial transparency in digital finance.
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