End of Nospetco and other scams?

It appears like the end of another long and winding pyramid scheme has come to an abrupt end. According to Nigerian BusinessDay newspaper: “Bubble bursts as ‘wonder bank’ fails to deliver returns

Barely one month after the Central Bank of Nigeria (CBN) sounded an alarm about the re-emergence of wonder banks in the country, the bubble has began to burst as one of the organisations has closed shop following its inability to settle bogus interests promised investors.

Business Day gathered that the “wonder bank” which has offices in Ajao Estate, Egbeda and Ikeja areas of Lagos, with head office in Ibadan has crashed as it was unable to pay thousands of its depositors the jumbo interests promised just within 26 weeks of operation.

Most of the depositors who lodged various sums of money with this institution met its three Lagos offices locked when they visited the place last week to collect their heavy interests for week 26 which was due for collection.

This is where the scam really is:

The organisation has been accepting as minimum deposit the sum of N10,500 from depositors with the promise to deliver N20,000 after three weeks of lodgement.

Well, BusinessDay did not mention Nospetco in its report, but Vanguard was much more explicit. They couldn’t have put the headline better: “Voodoo fund managers on the prowl”

They claim to be fund managers. That their business is genuine, clean, not designed to defraud members of the public, and in fact aimed at alleviating poverty. But there is something eerie, strange and chilling about their operations and conduct casting doubt on this claim.

For example, except for Treasure Interlink Limited, none of these companies visited had a visible signboard at their offices. Also, none of the owners or directors of these companies wants to be identified publicly. Perhaps due to the recent onslaught by the Central Bank of Nigeria (CBN) and the Economic and Financial Crimes Commission (EFCC), the personalities behind these companies have made themselves elusive. For example, one of the directors of Treasureline Interlink with headquarter located at Divine Favour Plaza Fajuyi road, Ibadan, Oyo State, who accepted to a telephone chat, was introduced by his staff as Mr Oyekale Oyeniran. But it was discovered that his actual name is Mr Isaac Ademola Kolade.

Many of them also have one thing in common, they’re headquartered in my hometown, Ibadan.

The companies also bear queer but seemingly attractive names .i.e. Wealth Solutions, Success Point, Pennywise, Spring of Wealth, Cash Seed, Open Gate, Fantastic Options, Gold Power etc. Another puzzling aspect of these companies is that most of them have their headquarters located in the ancient city of Ibadan. And nobody seems to know why this is so.

Why any Nigerian will deposit a massive 450,000 Naira (about 3,500 US Dollars) into a shady investment scheme beats my imagination. Of course the “investment schemes” do not potray themselves as scams. They also promise huge rewards for such investments and gullible Nigerians fall prey for such scams. Nospetco for example, promises to pay 40,000 Naira monthly on your 450,000 Naira “investment”.

What they do not tell you is that this business of theirs is nothing new. Its an old scam whereby deposits from new members are used to pay old members. Thus, the scam continues as long as new members join. It is thus not surprising that Nospetco has been around and waxing strong for 5 years now.

Vanguard reports that the Central Bank of Nigeria (CBN ) and the Securities and Exchange Commission (SEC), had placed advertisement in the media recently that anybody patronizing these companies does so at his/her own risk. Despite the warnings, a large number of people queue up on daily basis to join the schemes offered by these companies and even new ones are being floated.

The bubble is bursting – not because there are no new gullible members to join, but because the Central Bank of Nigeria had ordered that commercial banks closed the accounts of these schemes. The Economic and Financial Crimes Commision (EFCC) has been hunting down the directors of this shady schemes thus making business much more difficult to run.

In case you did not know, a pyramid scheme according to Wikipedia, is a non-sustainable business model that involves the exchange of money primarily for enrolling other people into the scheme, usually without any product or service being delivered, and is highly illegal. Pyramid schemes have existed for at least a century. Matrix schemes use the same fraudulent non-sustainable system as a pyramid; here, the victims pay to join a waiting list for a desirable product which only a fraction of them can ever receive.

I’d do a detailed analysis of all the Nigerian pyramid scams I can research on, shortly. Meanwhile, please share your thoughts here and now.

NOTE: This post and other subsequent ones related to Nospetco should in no way be misconstrued as assassinating the character of Nigerians in any way. I am calling them scams not because they are run by Nigerians but because they are truly scams. There are many hard-working and truthful Nigerians out there.

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Oluniyi D. Ajao
Oluniyi D. Ajao is an Internet Entrepreneur and Tech Enthusiast based in South Africa. Follow him on twitter @niyyie for more tech updates.


  1. Dave,

    I hadn’t seen this bit of news until I saw your trackback. Shame on both the scammers and the scammed. There is nothing new under the sun; except the packaging. Get-rich-quick schemes will always appeal to the greedy. They may call it poverty alleviation or whatever other fancy name they so wish, but it is pure and simple greed.

    We’ll see where all this ends, though some of us can tell upfront. Thanks for the heads-up.


  2. Scam or no scam, we will agree that CBN/SEC is the one precipitating the present colapse? Pls tell me that the banks and NSE are not the ones behind these? So now that the accounts are frozen is cbn protecting those that already have their money there or protecting its friends in NSE n the banks?? I thot Cbn came out on the pages of the papers that the cant particulaly say what is illegal about these firms? :twisted::twisted:

  3. Hi Niyi,

    Really want to commend you in your efforts to follow up this issue, it has really help lots of Nigerians in this mess to be enlightened…

    just want to make an inquiry about the extent of truth as to wether Nospetco has been lisenced to operate. & pls help confirm in the Sunday Sun newspaper of 2nd September, 2007.

    I’ll be happy & appreciate you for your assistance.


  4. it is very unfortunate that so many nigerian fall victim o of these unsuspecting scammer just like me, i paid huge amount into one wealth solution account and up till this moment i have never had my return. it pain me much when we have the EFCC who can even arrest the banks that give those scammer chance to use their platform to defraud Nigerians. It really pains to the marrow of the bone cos up till this moment nothing has been done.

  5. oh boy…na die be this ooo.Am neck deep and as it is i have my life lines on PMI,wealthsolution and New Freedom in Ibadan.As it is,i can get a divorce soon cos all my savings in in this stuf and everyday i check on the news for anything new…e just have to keep hoping.
    I se why nigerians do anything to make ends meet.I hope i won’t be seeking an alternative soon..GOD HELP US

  6. kindly please give me an update on NOSPECTO,WEALTH SOLUTION AND TREASURE LINE, as i heard on news on 7th jan 2008,that some wonder banks has finally been closed.Thank you

  7. Sir,
    I really need your help, is my initial capital still with safe? is Nospeco paing us our initial deposite? not minding the interest.
    Can i be asured of getting anything back? please I need ur advice before I do something stupid to myself.

  8. The government is involved in the scam as legal proceedings will only reveal this … the ceo can not live very longer

  9. please i’ll like to know latest about wealth solution and the best advice to follow .is it that i should foget about my capital or i should keep hoping for any good thing through the the goverment’s intervention.it’s been very hard for me to walk freely since last year.please help me to decide what to do next.maybe i should go on exile bcos the money isn’t mine.it’s my boss’s.

  10. Meeen! na hope I dey since last year o. I am surferring now. Seriously surferring. I lost furtune last year. too much

  11. Let CBN let the worrying public know the outcome of the exercise carried out in respect of all these wonder banks/illegal fund managers

  12. Please, the EFCC should try and do something about this issure of NOSPETCO because other victims like me were suffering. You can’t imagine me going back to Nigeria from Ukraine because my Dad couldn’t pay my school fees. I believe this will not be the end of my life, God will open a new way for me.

  13. gud day,ur job is well done.God bless for providing info.
    pls kindly let me know d latest on wonder banks and nospecto.let people know the latest between them and the EFCC OR ICPC.TX

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