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SEC Orders Investment Crowdfunding Platforms to Register by June 30th

The Securities and Exchange Commission (SEC), has ordered all existing investment crowdfunding portals/digital commodities investment platforms to register with it on or before June 30th, 2021, or cease operations. This was disclosed in a statement by the SEC.

This also applies to those with digital commodities investment platforms like Piggyvest, Trove, Bamboo, Chaka, and other entities rendering similar services.

According to the SEC, the rules governing the crowdfunding business in Nigeria came into effect on the 21st day of January 2021. This was part of efforts by the Commission to secure investor funds while encouraging innovation in the conduct of securities business.

“In line with the transitional provisions of the Rules, all persons/entities operating an investment crowdfunding portal/digital commodities investment platform prior to the commencement of the rules were expected to restructure all operations in accordance with the requirements of the rules and apply for registration not later than 90 days from the Effective Date.

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“While the transitional period elapsed on the 21stday of April 2021, the Commission hereby directs all existing investment crowdfunding portals/digital commodities investment platforms to note the requirements and eligibility criteria for raising funds through and/or operating a Crowdfunding Portal and comply with registration requirements or cease operations by the 30th of June, 2021, failing which the operations of such platform would be categorized as illegal and attract regulatory sanction as stipulated in the Rules”.

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