Scam social media accounts touting fake investment options have proliferated all over the world. The American Federal Trade Commission report from January shows that “95,000 people reported about $770 million in losses to fraud initiated on social media platforms in 2021.” Investment scams, romance scams, and online shopping fraud account for over 70% of the scams.
In Nigeria, the story is similar.
A scammer’s claim to fame
Imu Ovaioza Yunusa’s story is emblematic of the new wave of social media celebrities who spent their time on the internet, dishing out investment advice to followers who believed them, because they could see the credentials that the age of Instagram defined as success.
She introduced her business, Ovaioza Farm Produce Storage Business (OFPSB) after she opened a Facebook account, with which she allegedly took 3 billion naira from supposed investors. Influencers on Facebook helped her promote her investment options.
Yunusa took photos in front of properties she said were hers. She bought cars for her employees. She went on fancy, luxurious holidays, including the Maldives, where hotels were built of crystal clear water and cost as much as $1,000 per night.
The now-arrested investment expert said she had bought a plaza for 600 million naira. The same plaza was on sale for 500 million naira on Jiji.
She became a champion for kindness. Once she posted on Facebook:
Show kindness to those who are kind and be generous to those who are generous so that we can reduce the number of ingrates who go about saying, ‘They stopped helping because I thought I would die, but God raised someone else’.
Imu Ovaioza Yunusa
When she started offering investment opportunities with enticing returns to followers, they bought into it.
By 2020, Imu Ovaioza Yunusa had become a full-blown investment manager popular on Facebook. And, at the peak of her fame, Vanguard ran an editorial calling her “a fierce young Nigerian agro entrepreneur redefining the agricultural sector.”
Last week, the police arrested her in Lugbe, Abuja, for fraud to the tune of billions of naira through her Ovaioza Group of Companies.
The rise of online scammers
Online scamming came after the advent of the internet. But, with social media offering unbridled access and algorithms that cage users in interest categories, scammers run on the internet nearly unnoticed by users outside their interests.
For some of their victims, they came looking for romantic relationships, others looking for investment plans. Over the years they have proliferated accounting for $770 million of online fraud in 2021, according to the American Federal Trade Commission.
Ovaioza’s story, and arrest, immediately sent shockwaves across the internet. Users lamented how they had been scammed on the internet while they were investing in some agro-business, forex trade or cryptocurrency.
How did they do it?
Scammers have perfected the act of defrauding usually unsuspecting Nigerians on the internet. They adopt usernames similar to famous brands.
For instance, the Twitter account of a notorious scammer, @zenlthbankw, is similar to the commercial bank, Zenith Bank. @zenlthbankw requests official bank account details from users and then clears their account of all their money.
Twitter suspended the account this week.
Sometimes, the scammers tell users they’re forex traders who could help them multiply their money. At other times, they hijack accounts of users and send DMs to their followers advertising investment opportunities.
The case of Racksterli investment, a purported investment platform that was promoted by some top celebrities and scammed millions of people within nine months, is only one of many such platforms.
Can victims get their money back?
“A victim generally has two options in recovering his money or seeking justice when a victim of fraudulent activity,” Tano Onovughe, a legal researcher, told Technext.
Either through civil litigation or by pursuing a criminal prosecution.
Tano Onovughe
He said the civil process offers the “injured” party “an opportunity to seek damages, restitution, and further compensation for any form of the harm he or she might have suffered as a result of the fraud.”
He added that it must “meet the requirement under legislation.”
For instance, a Ponzi scheme could be argued by lawyers to be just a bad investment and not a scam.
How can they be stopped?
Stopping online scammers at the most granular level rests on the shoulders of social media companies. And, social media companies will need to act swiftly in investigating reported accounts. They will also need to include more guardrails around who can open accounts on the platform.
The final step is for users to verify approaching investment managers, and research the opportunities they offer.
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