More Nigerians continue to fall victim to investment and crowdfunding fraud by the day. While many have become homeless, out of school and indebted as a result of their financial decisions, they have constantly hung on to the hope that one day, all that is lost would be restored.
In this interview with Nairametrics, Nnamdi Chife, the managing partner at Chive GPS speaks on trends in the industry and the part that debt recovery agencies could play in helping to retrieve lost funds… Excerpt
What is Chive GPS and what is the company about?
CHIVE GPS is a conflict resolution company that specializes in debt recovery, background checks, geolocation intelligence, asset tracing and security services. We have recovered funds in Dubai, USA, CANADA, UK and Nigeria. We track individuals who are evasive or out of the country, including asset tracking.
What strategies do you adopt in helping to retrieve funds and which agencies do you partner with?
Strategies include issuing demand notices, legal action, petitioning law enforcement to initiate criminal investigations into debts related to fraud. We also conduct asset tracing and geo-location to aid funds retrieval. We partner with the EFCC and FCID (INTERPOL) in respect to these cases.
In recent times, crowdfunding has become a mess in Nigeria. How did we get here?
Some persons with fraudulent intent took advantage of the success of MMM, the infamous Ponzi scheme, and launched all kinds product-backed Ponzi schemes like agriculture, forex, crypto and real estate, all in a bid to steal from Nigerians. It’s also a problem of regulatory failure.
Why is debt recovery agency necessary for investors that fall victim to fraud and what is the process and procedure for engaging one?
We designed our operations to serve financial institutions but we began to receive a plethora of requests from individuals whose funds were trapped in crowdfunding companies. Most of these individuals that reached out to us could not afford our services individually so we advised them to come together as a group of victims, raise the fees amongst themselves and present a joint request to CHIVE GPS to coordinate the debt recovery operations, because it’s very important for the victims to use all necessary legal measures to retrieve back their funds.
On a scale of 10, What is the tendency that debt recovery agencies can retrieve investors’ funds?
7/10. We have been very successful with the debt recovery operations. We have many of these Ponzi companies that have made refunds or are in the process of full remedial.
How long does a debt recovery process take?
It takes six months to 24 months depending on the circumstances of the case.
What are the red flags to watch out for before investing in any crowdfunding or investment platform?
Questions to look out for include; what is the character and experience of the founder? What is the underlying asset? How old is the company? What is their financial capacity? What type of license are they practising with? What type of insurance?
Who is to be blamed for the failure of crowdfunding in Nigeria?
It’s the failure of regulation that led to this and the harsh macroeconomic environment.
What is the future of crowdfunding in Nigeria?
It’s kind of a bleak future. The government needs to impose stringent conditions for crowdfunding and ensure it’s strictly policed to weed out frauds and enthrone market transparency and accountability.
What is your advice for investors expecting funds from crowdfunding companies at this crucial period?
It’s tough but they need to start some form of action to retrieve their funds. But they should view the process as long term, manage their expectations and stay focused on the case until funds are fully recovered.