INFLUENCE FOR SALE: CRIMINAL AND REGULATORY LIABILITY OF CELEBRITIES/SOCIAL-MEDIA INFLUENCERS WHO PROMOTE FRAUDULENT BUSINESSES IN NIGERIA
Influencer marketing heavily impacts commercial advertising in Nigeria, especially across fintech, crypto, and real estate. When these promoted ventures turn out to be fraudulent or illegal schemes, questions arise regarding the influencer’s legal liability.
Under Nigerian law, endorsement alone does not make an influencer criminally liable for a sponsor’s wrongdoing without proof of a specific act and intent (except it may negatively impact there credibility). However, influencers cross into criminal liability if they knowingly make false representations, aid fraud, conspire, launder money, or illegally conduct regulated financia promotions bearing in mind that ignorance of the law Is not an excuse. This article concludes that influencers promoting financial and digital-asset products must implement a risk-based due diligence framework prior to engagement.
INTRODUCTION
The commercial value of fame has existed for as long as advertising itself. What has changed in the social media age is the intimacy, immediacy and scale with which fame can be monetised. Celebrities or digital content creators with millions of followers may communicate directly with an audience without the institutional intermediaries traditionally associated with advertising. A recommendation may appear between photographs of family life, comedy videos and personal commentary. To the follower, the distinction between personal recommendation and commercial advertising may consequently become blurred.
That characteristic makes influencer marketing exceptionally valuable to businesses. A conventional advertisement effectively says: the company says its product is good.
An influencer endorsement carries a different message: someone you know, admire or trust appears to say that this company is good.
In commercial terms, the influencer therefore lends the advertiser more than audience reach. He lends the advertiser his reputation and credibility.
The implications are particularly serious where the advertised product is not a consumer good but a financial service. Nigerian social-media users are routinely exposed to advertisements and endorsements relating to cryptocurrency and digital-asset platforms, investment schemes, foreign-exchange businesses, financial technology companies and other businesses into which consumers are invited to deposit or transfer funds.
The legal problem becomes acute where the business later proves fraudulent. Customers may discover that supposed investments never existed, promised returns were fabricated, withdrawals cannot be made, or funds have been diverted. In more serious cases, the company itself may have been established or operated partly as a vehicle for laundering proceeds of unlawful activity.
Victims will naturally ask why the celebrity who persuaded them to patronise the company should escape responsibility while claiming simply to have been paid to advertise.
Yet criminal law cannot proceed solely upon that understandable sense of grievance.An influencer does not become a guarantor of every company he advertises. Corporate failure is not necessarily fraud. Fraud by corporate officers is not automatically fraud by an advertising ambassador. Criminal responsibility ordinarily remains personal and depends upon proof of the elements of the particular offence alleged.
The real question is therefore narrower and more useful:
At what point does an influencer cease to be merely an advertiser and become a participant in, facilitator of, or otherwise legally responsible for unlawful conduct committed through the enterprise he promotes?
An influencer may engage in several ways. At the simplest level, the influencer may publish a pre-approved advertisement supplied by a company in return for a fixed fee. At another level, the influencer may personally endorse the product: “I use this platform and recommend it. “More significantly, the influencer may make factual assurances:”I have personally verified this company.” “They are licensed by the SEC.” “Your investment is guaranteed.” “You cannot lose your money.” At an even deeper level, an influencer may receive a referral code and earn a commission whenever a follower deposits funds. The influencer may participate in webinars, answer questions from prospective investors, reassure customers experiencing withdrawal difficulties and repeatedly encourage followers to increase their investments.
These arrangements are not legally identical.
The closer the influencer becomes to the actual solicitation and procurement of customers, the greater the importance of determining precisely what the influencer knew and intended.
That produces a central proposition for this article:
Influencer liability should be analysed according to conduct, knowledge and participation rather than occupational labels.
A defendant does not acquire immunity from ordinary criminal law merely because his role in an unlawful enterprise was described contractually as “brand ambassador”.
APPLICABLE LAWS AND REGULATIONS
The Advertising Regulatory Council of Nigeria Act 2022 (“ARCON Act”). The Act reflects the modern reality that advertising is not confined to newspapers, radio, television and billboards. Section 54 is particularly significant. It provides, in substance, that any person—including the sponsor or beneficiary of an advertisement—or organisation that creates or places an advertisement for publication or exposure in any medium directed at the Nigerian market without prior approval of the Advertising Standards Panel commits an offence and is liable to the applicable fine.
The breadth of the language is important.
A paid TikTok video does not cease to possess an advertising character merely because it appears on an individual’s account. Nor should describing commercial content as a “collaboration”, “partnership” or “brand deal” necessarily determine its legal character.
Section 57 provides a further enforcement mechanism. Subject to the specific provisions of the Act, a person or organisation that violates or contributes to a violation of the Act is liable to the prescribed penalty; ARCON may additionally direct compensation for direct loss, while other remedies may remain available.
Consequently, even before asking whether the underlying business committed fraud, an influencer campaign may present a separate question of advertising compliance.
This distinction matters because regulatory liability for an advertisement and criminal responsibility for the advertiser’s fraud are separate questions.
An influencer could conceivably breach an advertising requirement without knowing that the underlying company was fraudulent. Conversely, compliance with advertising-vetting requirements would not immunise an influencer who knowingly participated in fraud.
Section 123 of the Federal Competition and Consumer Protection Act 2018 (“FCCPA”) prohibits false, misleading, or deceptive representations in marketing. Importantly, section 125 applies not only to businesses but also to persons acting on their behalf, which may include paid influencers.
Therefore, influencers who make factual ascertainable claims about matters such as licensing, government approval, investment guarantees, or risk may face legal responsibility, particularly where they lack a reasonable basis for those claims. Following an advertiser’s script does not necessarily shield an influencer from liability for misleading statements communicated to consumers.
WHEN ADVERTISING BECOMES FRAUD: THE ADVANCE FEE FRAUD ACT
The Advance Fee Fraud and Other Fraud Related Offences Act 2006 (“AFF Act”) may impose-criminal liability on influencers who knowingly use false representations to induce followers to part with property.
Under section 1(1), liability is not limited to cases where the accused personally receives the victim’s money. It also covers inducing a person, by false pretence and with intent to defraud, to deliver property to any person.[5] Thus, an influencer who knowingly promotes a fraudulent investment may potentially be liable even where followers pay the company directly.
Section 20 defines “false pretence” broadly to include deliberate or reckless false representations about existing facts or law where the maker knows the representation is false or does not believe it to be true.[6] Nigerian appellate decisions similarly emphasise falsity, knowledge, intention to defraud and inducement as central elements. Oluwasheun v Federal Republic of Nigeria (CA/J/268C/2014) [2016] NGCA 30 (19 May 2016).
However, inadequate due diligence alone does not establish criminal fraud. The prosecution must prove the statutory elements and the necessary dishonest state of mind. Poor influencer due diligence may be evidence of fraud, but it is not automatically proof of it.
6. The Influencer Who Aids the Principal Offender
An influencer may also incur liability by assisting others to commit an offence. Section 7 of the Criminal Code extends responsibility to persons who enable, aid, counsel or procure thecommission of an offence.
This is particularly relevant to fraud schemes involving different participants performing different roles. An influencer need not personally receive or transfer victims’ funds if their conduct knowingly facilitates the fraud.
Accordingly, there is an important distinction between an influencer who innocently delivers a advertising script and one who knowingly persuades followers to invest in a fraudulent scheme. Liability depends on the influencer’s conduct and state of mind, not merely their title as an advertiser or ambassador.
CONSPIRACY: FROM ENDORSEMENT TO CRIMINAL AGREEMENT
Conspiracy may arise where an influencer knowingly agrees with others to pursue a fraudulent scheme. Because direct evidence of such an agreement is often unavailable, Nigerian courts may infer conspiracy from surrounding circumstances. Okafor v State (Okafor v State (SC 834/2014) [2016] NGSC 55)emphasises the need for a meeting of minds directed toward an unlawful purpose or unlawful means.
Evidence may include knowledge that the investment is fictitious, profit-sharing arrangements, participation in strategy meetings, awareness of failed withdrawals, and continued solicitation of deposits despite knowledge of the fraud.
A contractual label such as “brand ambassador” does not prevent criminal liability where the evidence establishes participation in a common criminal enterprise. Equally, mere association with offenders is insufficient: the prosecution must prove the criminal agreement beyond reasonable doubt.
THE INVESTMENTS AND SECURITIES ACT 2025 AND THE RISE OF THE “FINFLUENCER”
The Investments and Securities Act 2025 (“ISA 2025”) makes this subject particularly contemporary.
The new legislation expressly brings virtual assets, digital assets, distributed-ledger-technology offers, tokens and products within its statutory conception of investments.
This matters enormously for influencer marketing.
Cryptocurrency and investment businesses are among the industries most capable of exploiting influencer credibility. Their products may be technically complex, difficult for ordinary consumers to independently verify, and capable of causing substantial financial loss.
In May 2026, the Securities and Exchange Commission issued a public notice specifically warning about the increasing promotion of unregistered online investment schemes through social-media platforms including Instagram and TikTok.
The Commission warned against unrealistic or guaranteed returns and advised members of the public not to rely on investment advisories circulated online by unregistered persons or entities. Significantly, the SEC stated that, under the ISA 2025, only entities registered by the Commission are authorised to promote investment services, provide investment advisory services or solicit funds from the public in the Nigerian capital market.
This development should fundamentally alter the approach of Nigerian influencers to financial endorsements.A Certificate of Incorporation from the Corporate Affairs Commission proves that a company has been incorporated.
It does not, by itself, establish that the company is authorised to conduct every regulated financial activity it proposes to conduct.
An influencer contemplating an investment-related campaign should therefore ask: What precisely is this company licensed to do, and by whom? The answer should be independently verified with the relevant regulator.
DOES AN INFLUENCER OWE A DUTY TO INVESTIGATE
This is perhaps the most difficult policy question.
Existing criminal law should not be distorted to manufacture a general offence of “failing to investigate an advertiser” where the legislature has created none.
Nevertheless, the absence of an automatic criminal duty does not make due diligence irrelevant.
Due diligence can perform at least three legal functions.
First, it may prevent the influencer from making an objectively false representation.
Second, contemporaneous due diligence records may become powerful evidence concerning the influencer’s state of mind if criminal allegations later arise.
Third, in heavily regulated industries, due diligence may reveal that the proposed advertisement itself cannot lawfully proceed.
An influencer who possesses an independent legal opinion, regulator search, copy of a valid licence, correspondence confirming regulatory status and written substantiation for advertising claims is factually situated very differently from one whose only explanation is:
“They paid me, so I posted what they sent.”
Due diligence should therefore be understood not as a universal defence created by statute, but as an important mechanism for preventing violations and evidencing good faith.
INFLUENCER DUE-DILIGENCE FRAMEWORK: THE NEED FOR LEGAL COUNSEL
Having identified the circumstances in which liability may arise, the practical question is how influencers and their advisers can reduce these risks before and during an endorsement relationship.
1. Assess the Risk Level
Standard screening may be sufficient for ordinary consumer products. Enhanced due diligence should, however, apply to endorsements involving real estate investments, securities, cryptocurrency and digital assets, forex and trading platforms, lending and other financial products, crowdfunding, businesses accepting customer deposits, gambling, health-related products, and products or services promising financial returns.
2. Verify the Legal Entity
The influencer or agency should independently establish the advertiser’s full registered name, registration number, registered and operational addresses, directors, and persons exercising ownership or control. This helps confirm that the business being promoted is a genuine and identifiable legal entity.
3. Confirm Regulatory Status
Where the activity is regulated, the influencer should determine which regulator has jurisdiction, whether authorisation or licensing is required, whether the advertiser holds the necessary authorisation, and whether it covers the specific activity being promoted. The status and validity of the licence should also be checked, together with any regulatory warnings, restrictions, suspensions, or enforcement action.
For securities, investment, and relevant digital-asset activities within the SEC’s jurisdiction, verification should include appropriate checks against SEC records and, where necessary, advice from qualified legal counsel.
4. Examine the Compensation Structure
Enhanced scrutiny is appropriate where remuneration is linked to customer deposits, the number or value of investors recruited, customer trading losses, tokens issued by the promoted project, or an undisclosed ownership interest in the advertiser.
Such arrangements may create incentives and conflicts of interest that differ substantially from a fixed advertising fee and should therefore be subject to careful legal and compliance review.
5. Ensure Adequate Contractual Protection
Endorsement agreements should include appropriate representations and warranties concerning legality, regulatory authorisation, and the accuracy of information supplied to the influencer.
They should also provide for prompt notification of regulatory investigations or other material developments, suitable indemnities, immediate termination rights, removal of promotional content, cooperation with corrective statements, and continuing disclosure obligations.
Contractual protections are important, but they cannot shield an influencer from liability arising from the influencer’s own unlawful conduct.
6. Maintain Ongoing Monitoring
Due diligence should continue throughout the endorsement relationship rather than ending once promotional content is published. A fresh review should be triggered by significant developments, including widespread withdrawal complaints, regulatory warnings or licence suspensions, unexplained disappearance of directors, requests to redirect customer payments to unrelated accounts, sudden changes in banking arrangements, requests to remove previous disclosures, pressure to reassure customers despite contrary information, or the commencement of law-enforcement investigations.
Why “#NotFinancialAdvice” Is Not a Complete Defence
Social-media promoters frequently use disclaimers such as “Not financial advice” or “Do your own research.” While such disclaimers may serve legitimate purposes, they should not be treated as a universal exemption from legal responsibility.
For example, if an influencer states:“I have personally confirmed that XYZ Investments is licensed by the SEC. Your capital is guaranteed and you will earn 40% monthly. Not financial advice.”
If those substantive representations are knowingly false, adding “Not financial advice” does not make them accurate or necessarily remove the legal consequences of making them.
Similarly, telling consumers to “do your own research” will not necessarily neutralise a false or misleading representation intended to induce them to invest or transact.
Ultimately, legal responsibility is likely to depend on the substance, context, and overall effect of the communication, rather than on the presence of a disclaimer or hashtag alone. For high-risk or regulated endorsements, disclaimers should therefore complement—not replace—proper due diligence, accurate disclosure, regulatory compliance, and appropriate legal advice.
Conclusion
Influencer marketing can carry significant legal, regulatory, and reputational risks, particularly where promotions involve investments, financial products, digital assets, or other regulated activities. Influencers and talent-management agencies should therefore treat due diligence as an essential part of the endorsement process rather than relying solely on information provided by advertisers or on disclaimers such as “#NotFinancialAdvice.”
A structured approach involving independent verification, regulatory checks, appropriate contractual protections, and ongoing monitoring can substantially reduce exposure to risk. Importantly, where an endorsement involves complex, high-value, or regulated activities, influencers and their agencies should seek independent legal advice and retain qualified legal counsel at an early stage. Legal representation can assist in assessing regulatory obligations, reviewing endorsement agreements, identifying potential liabilities, and responding promptly where concerns or investigations arise.
Ultimately, an influencer’s commercial reach should be accompanied by appropriate legal safeguards. The greater the regulatory and financial risk of the product being promoted, the greater the need for careful due diligence and professional legal representation.
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