The Securities and Exchange Commission (SEC), on Tuesday said it has sealed off the premises of Growing Circle in Lagos for engaging in illegal fund management activities.
Specifically, the SEC accused Growing Circle of carrying out investment operations that falls within fund management without registration, just as it also constituted an infraction of the Investments and Securities Act (ISA), 2007.
A statement by the commission said Growing Circle’s mode of operation is that a new entrant registers with N10,000 but “is not entitled to products, while the second category has a registration fee of N16,000 that entitles the registrant to receive products.
“For anyone to come under the company, he has to come under an up liner since the company engages in networking business.
For the networking business, the least stage is a starter point with minimum registration of $50 with an incentive of $15 for a member who introduced two down liners.
The company also engages in free seminars at its head office for people to learn more about the products and the money making activities, offering an unbeatable compensation plan and huge bonuses.
Trouble however started when after registering however, members claim they do not get any products from the company and all efforts to retrieve their funds proved abortive, hence the complaint to the SEC.
While the company claimed to have a factory in Ogun state, the said factory could not be located even though the products were on display at their Lagos office.
The SEC Management said the closure was to end unlawful activities of the company aimed at swindling unsuspecting investors, urging investors to ensure they only deal with fund managers that are registered with the commission.
The commission said it relied on its powers under “Section 13 (w) of ISA 2007, to shut down any company carrying out capital market activities without due registration”.
Meanwhile, bank accounts of Growing Circle have been frozen and the promoters arrested and undergoing interrogation by the Nigeria Police Force.
The SEC therefore advises the public to exercise due diligence and caution in the course of making investment decisions adding that valid licence of lawful operators could be obtained on the commission’s website by members of the public to confirm the licences of firms with which they intend to carry out investment activities.