ISA 2025: Uwaleke recommends measures to ensure enforcement

By Tony Obiechina Abuja
Professor of Capital Market & Director, Institute of Capital Market Studies, Nasarawa State University Keffi, Uche Uwaleke has recommended measures that should be implemented by the Securities and Exchange Commission to strengthen the implementation of the Investments and Securities Act (ISA) 2025, particularly in the area of protecting retail investors in foreign platforms.
Uwaleke, Nigeria’s first capital market professor, stated this in his presentation at the ISA 2025 sensitisation workshop organised by the ICMS in collaboration with Capital Market Academics of Nigeria.
The Chairman of the session was Dr Suleyman Ndanusa, former DG/Chairman of SEC. The event was moderated by Prof Ezeoha, Deputy Vice Chairman of Alex Ekwueme Federal University with panelists made up of Prof Augustine Agom, Prof Adeshina Bello, Prof Seth Akutson, Prof Aliyu Sanusi and Prof Ayo Adewole.
Others are Prof Olufemi Saibu, Prof Yinka Adenikinju, Prof B.F Nwinee, Prof Bode Ayorinde, Prof Ayo Olowe, Prof Chuke Nwude and Prof Collins Ajibo.
Uwaleke made the comment following the signing of the ISA 2025, which is designed to overhaul the capital market landscape.
The Act also repealed the ISA 2007. The Act significantly strengthens the Securities and Exchange Commission’s (SEC) authority.
Section 26 of the Act also broadens the scope and definition of securities to include virtual and digital assets such as cryptocurrencies and investment contracts.
The Act also empowers the SEC to prosecute Ponzi scheme operators, with penalties including 10-year prison sentences and fines of not less than to ₦20m.
Uwaleke commended the SEC for coming up with the ISA 2025 as it would boost the contributions of the capital market to the Nigerian economy.
However, he said that despite the significant strides made by the ISA 2025, unresolved issues remain in terms of market regulation and investor protection.
“There are still potential loopholes that market participants could exploit—especially in areas where the law is broad or ambiguous,” Uwaleke said.
The professor argued that ISA 2025 does not adequately address cross-border securities trading or regulatory cooperation with foreign jurisdictions.
He said, “Foreign platforms offering securities or crypto products to Nigerian users may not fall under the SEC’s jurisdiction if they have no local presence.
“Offshore investment apps serve Nigerian users without fully complying with ISA 2025 (eg Trove, Bamboo, Risevest, Chaka, Passfolio, and Hedge which offer access to U.S and Chinese stock markets as well as Binance/Kraken for crypto based investments) Platforms like Trove and Bamboo partner with U.S.-based custodians.”
Uwaleke disclosed that the implication is that as Nigerian investors access foreign investment platforms, regulatory gaps may expose them to unprotected risks.
He said investors using such platforms may have no legal protection in case of fraud or platform collapse.
The expert said, “If the platform’s custodians or brokers fail, investors may lose access to their assets. Offshore apps may not prioritize cybersecurity or customer support for Nigerian users.
“Investors have no recourse under Nigerian law in the event of fraud or loss. Nigerian investors may not qualify for protections like the U.S. SIPC or U.K. FSCS.”
According to him, ISA 2025 expands capital market access but lacks adequate provisions to protect retail investors in private placements or crowdfunding ventures.
He also noted that while the Act regulates digital assets, it does not fully integrate oversight for emerging financial technologies like Robo-advisors, or Algorithmic trading.
Uwaleke said ISA 2025 lacks explicit provisions mandating Environmental, Social, and Governance (ESG) disclosures for public companies, adding that public companies may under-report non-financial risks.
He said while ISA 2025 strengthens the Investments and Securities Tribunal (IST), it does not provide for legal aid schemes or structured class action.
To manage the loopholes in favour of Nigerian investors, Uwaleke called for a bilateral or multilateral memoranda of understanding (MoUs) with international regulators to manage cross-border fraud, digital trading, and compliance.
“Require foreign apps to register locally before offering services. Geo-block URLs: Order ISPs to block access to the websites and apps of non-compliant platforms inside Nigeria
“App store control: Request Google Play and Apple App Store to restrict downloads of specific apps within Nigerian territory.
“Block payment channels: Direct banks, card networks, and payment processors (like Flutterwave, Paystack, etc.) to stop processing transactions related to banned platforms”, he suggested.
In conclusion, he said ISA 2025 represents a significant step forward in modernizing Nigeria’s capital market framework, enhancing regulatory oversight, and providing robust investor protection.
He expressed gratitude to Prof Collins Ajibo who spoke from his base in Germany and other distinguished Capital Market Academics who participated at the discussion.
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Some of them are Malam Mairiga Aliyu Katuka (Chairman SEC Board); Dr Umaru Kwairanga (Group Chairman NGX Group); Mr Oluropo Dada (President CIS); Prof Magnus Kpakol (former Minister of National Planning); Mr Hassan Bello (MD/CEO NDIC); and Dr Suleiman Abubakar (MD/CEO, Sterling Bank) among others.