The Corporate Affairs Commission (CAC) has issued a stern six-week deadline to all unregistered businesses in Nigeria, demanding immediate registration or risk facing criminal prosecution. This directive, which stems from the provisions of the Companies and Allied Matters Act (CAMA) 2020, follows heightened scrutiny of business operations in the country in the wake of the recent collapse of a massive cryptocurrency scam, CBEX, which defrauded Nigerians of approximately N1.3 trillion.

In a public notice titled “Carrying on Business in Nigeria Under an Unregistered Name or Acronym,” issued on Tuesday, the CAC emphasized the legal consequences of operating a business without formal registration under Nigerian law. The commission cited Section 863 of CAMA, which classifies unregistered business operations under names or acronyms not recognized by the Act as criminal offenses punishable by imprisonment.

The CBEX Scandal and its Ripple Effects

The CAC’s renewed enforcement campaign comes shortly after the unraveling of CBEX, a fraudulent cryptocurrency investment platform allegedly promoted by ST Technologies International Limited. While ST Technologies was formally registered with the CAC, it was neither licensed by the Securities and Exchange Commission (SEC) nor authorized to function as an investment platform.

The Economic and Financial Crimes Commission (EFCC), in the aftermath of the scandal, clarified that CAC registration alone does not confer investment operation legitimacy. The CBEX case exposed serious regulatory gaps and highlighted the need for stricter oversight of businesses, particularly in the financial and technology sectors.

The EFCC stressed that although ST Technologies held a certificate from the Special Control Unit Against Money Laundering (SCUML)—an arm of the Federal Ministry of Industry, Trade and Investment—this certificate does not equate to SEC licensing. Therefore, despite appearing to be in regulatory compliance, the company lacked the required legal authority to attract or manage investments.

CAC Clarifies Legal Obligations for Businesses

According to the CAC’s public statement, every business operating in Nigeria—be it a company, limited liability partnership, limited partnership, or sole proprietorship under a business name—must complete proper registration as stipulated by CAMA. Additionally, it is illegal for any entity to operate under a name or acronym that has not been registered.

The Commission cited Section 729 of the Act, which mandates that registered businesses must prominently display their registered name and CAC registration number at all operational locations. This requirement extends to all official business publications, including letterheads, advertisements, promotional materials, and signage.

“In particular,” the CAC noted, “companies are required to include their registered name and CAC registration number on all formal correspondence and marketing content.”

The statement further emphasized that non-compliance could result in criminal charges, including jail sentences of up to two years. Section 862(1) of the Act specifically penalizes individuals who knowingly make false statements in any legally mandated business documentation, whether in print or electronic formats. Convicted violators risk both imprisonment and daily fines for each day the offense persists.

Six Weeks to Register or Face Prosecution

The CAC has now set a six-week grace period for unregistered businesses to comply with the statutory requirements. At the end of this period, the Commission warned that it will begin taking enforcement actions, including initiating criminal prosecution against non-compliant entities.

This notice affects a wide range of enterprises, including sole proprietors who may be operating informally under brand names or acronyms that have not been legally registered.

“All companies, limited liability partnerships, limited partnerships, and business name proprietors must comply with the provisions of the Act within six weeks of this notice,” the CAC stated. “Failure to comply will attract enforcement actions including prosecution.”

Public Urged to Verify Business Credentials

In response to the rising number of fraudulent schemes disguised as legitimate investment platforms, the CAC urged members of the public to confirm the legal standing of businesses before engaging in financial transactions. This includes checking whether the business has a valid CAC registration number and determining if it holds any required operational licenses from agencies such as the SEC or the Central Bank of Nigeria (CBN).

The Commission encouraged stakeholders and business owners to visit its official website www.cac.gov.ng for detailed guidelines and updates on how to fulfill the registration requirements.

Lawmakers and Agencies Urge Caution

Meanwhile, the House of Representatives and regulatory agencies have taken a firm stance in response to the CBEX fallout. Lawmakers have warned influencers, public figures, and celebrities to avoid endorsing or promoting investment platforms that are not registered or licensed by relevant authorities.

This warning comes as several social media personalities have been linked to the promotion of CBEX, raising concerns about the influence such endorsements have on unsuspecting members of the public. The House emphasized the need for stricter advertising standards and improved digital content regulation to prevent further exploitation of Nigerians.

Strengthening Regulation in the Wake of Financial Scams

The collapse of CBEX and other similar schemes has brought renewed urgency to reform Nigeria’s financial oversight ecosystem. Analysts have noted that while registration with the CAC establishes a legal entity, it does not by itself validate a company’s business model or authorize it to engage in regulated activities such as investment services, fintech operations, or cryptocurrency trading.

To this end, both the EFCC and SEC have reiterated the importance of comprehensive due diligence before investing. The EFCC specifically clarified that the issuance of a SCUML certificate—designed primarily for anti-money laundering compliance—is not a substitute for business licensing or financial regulation.

Looking Ahead: A Warning and an Opportunity

The CAC’s six-week ultimatum serves as both a warning and an opportunity. For thousands of informal businesses across Nigeria, it is a chance to regularize operations and gain legal recognition. Registration not only provides businesses with credibility but also opens access to financial services, legal protection, and growth opportunities.

However, failure to heed the warning could attract the full weight of the law. As regulators tighten enforcement, businesses must align with legal frameworks to avoid the risk of shutdown, prosecution, or imprisonment.

Ultimately, the CAC’s directive reflects a broader shift toward increased accountability and transparency in Nigeria’s business environment—a necessary move to protect citizens and build investor confidence in the wake of high-profile financial scams.