An Unjust Enrichment Approach Tob Ponzi and Pyramid Schemes In Nigeria

Abstract

The paper makes the assertion that a difference exist between Ponzi and pyramid schemes even though both often occupy same square, especially in raising identical legal challenges. It argues that the traditional bankruptcy rules should be made more potent by supplementing them with principle of unjust enrichment. Accordingly, it presses a legal regime to make 'net-gainers' in the Ponzi and pyramid schemes to disgorge their illegal and unjust enrichment to 'net-losers.' It recommends the adoption of the remedial bent to unjust enrichment adopted by the Canadian jurisdiction as a good way forward in addressing the concerns of net-losers. It argues that the approach is of particular interest because the claimant need not establish a trust relationship with the defendant to succeed in reversing the unjust enrichment of net-gainers to make restitution. It therefore recommends an aggressive monitoring of potential Ponzi arrangements.