Published On: Mon, Dec 4th, 2017

Gwarzo: The many troubles of a regulator

 

By FELIX OLOYEDE

These are unpleasant times for Mounir Gwarzo, Chief Executive Office, of the Securities and Exchange Commission (SEC) as he was placed on suspension last week by a previously gun shy Minister of finance, Mrs. Kemi Adeosun. Gwarzo’s position as SEC boss became shaky as a nongovernmental organisation,   Centre for Anti-Corruption and Open Leadership (CACOL), sent a fiery petition to the House of Representatives accusing the top SEC chieftain of various issues of alleged corruption. By Wednesday November 29, 2017, Gwarzo had been yanked of his seat to await the outcome of investigations by the Independent Corrupt practices and other related Offences commission (ICPC).

The story which grabbed headlines on Thursday November 30, 2017 stated that Gwarzo, was suspended from office ‘to allow for an unhindered investigation of several allegations of financial impropriety leveled against the Director-General.’

According to a statement by Patricia Deworitshe, Deputy Director, Press, Federal Ministry of Finance, “the suspension is in line with the Public Service Rules (PSRs) 03405 and 03406.”

The statement further noted that, ‘The Honourable Minister has set up an Administrative Panel of Inquiry (API) to investigate and determine the culpability of the Director-General.’

‘She has directed the suspended SEC Director-General to immediately handover to the most senior officer at the Commission, pending the conclusion of investigation by the API.’

The Minister also suspeded two other officers of the Commission – Abdulsalam Naif Habu, Head of Media Division and Anastasia Omozele Braimoh, Head of the Legal Department – who were alleged to have engaged in financial impropriety .

The allegations

Since Gwarzo’s appointment as the Director General of SEC on May 22, 2015, the atmosphere of the capital market has been tense. A number of controversies have followed one another like lemmings dashing for the sea. Nevertheless, despite the occasional hint of maladministration and mismanagement, no serious attention has been given to the top management of the Commission.

However, recent reports which alleged financial impropriety have prompted petitions and a growing outcry of perceived highhandedness and insider abuse.

Gwarzo who has wielded steely control of the market regulator since assuming office in 2015 has been alleged to have collected severance pay in the sum of N104,851,154.94 while still in service.

SEC’s harried boss was previously an executive commissioner at the Commission between 2013 and 2015 when former President Goodluck Jonathan appointed him to head the body on May 22, 2015. On taking over leadership at SEC Gwarzo, allegedly paid himself a handsome package as entitlement for being an executive commissioner for two and a half years.

He is also was alleged to be a director in Medusa Investment Limited among other companies in violation of Public Service Rule 030424. The companies were alleged to have executed a number of contracts on behalf of Gwarzo and his family.

Gwarzo was also alleged to have awarded contracts to the same company and others to which he was related, thus resulting in a conflict of interest. These and other allegations of nepotism and victimisation were levelled against his regime since 2015. From the beginning of Gwarzo’s tenure some staffers of the commission have occasionally complained of Gwarzo’s excesses and unethical practices which were at variance with the structure and legacy of his predecessor which were more professional and work friendly.

Inside sources alleged that Gwarzo used virement (moving funds meant for one purpose to something else) to transfer funds from different departments of the Commission for personal use.

How trouble started

Gwarzo’s problem started when he insisted on collected a severance package which was meant for only for staffers who had ended their service and had completely disengaged their services from the commission. After allegedly forcing N104million out of the commission and paying same to himself as severance remuneration.

Worried by these activities, a group Known as Centre for Anti-Corruption and Open Leadership (CACOL), a human rights group, petitioned the authorities to investigate the matter. The group forwarded a petition to the lower legislative chamber, the House of Representative, over the alleged misdemeanour of SEC’s helmsman.

The group’s letter which was signed by its Executive Chairman, Debo Adeniran, frowned at some practices the group alleged to be unethical going on in SEC and described Gwarzo’s act as, “total disregard for standing rules in the civil service”.

The group explained that, “severance benefit can only be paid to an employee who has concluded his or her service and has completely disengaged from service and not to an employee who has been promoted within the commission as is in the case of Mr Gwarzo”.

CACOL insisted that the House of Representatives should probe the firms which the suspended SEC boss allegedly used in carrying out a number of transactions.

The group however, noted that the personal interest of Mr Gwarzo in the referred to companies contravened provisions of the Nigerian law which prohibits public officers from putting themselves in situations where their personal interest conflicts with that of their public duties.

CACOL insisted that Gwarzo’s actions as head of the capital market regulatory body was inconsistent with the high standards expected of such a sensitive body with the crucial responsibility for oversight of the Nigerian capital market.

“It is in view of these noted discrepancies that we urge you to institute a committee to beam searchlights on the activities of Mr Mounir Haliru Gwarzo’s as the Director General of the Securities and Exchange Commission.”

Those who have followed events in the capital market are beginning to peace some snippets of information which had made rounds about SEC before now.

Prior to this period, there have been reports alleging unethical issues in the operations of the apex regulatory office since 2015.

Analysts believe that Gwarzo’s suspension and the intervention by the Economic and Financial Crime Commission (EFFC) was necessary given the need to establish market transparency and maintain high standards of corporate governance.

A stockbroker who declined having his name mentioned in print for clear reasons of not wanting to be seen as arguing against a regulator, told Business Hallmark that Gwarzo has so far been professionally active and effective. But he added that SEC boss should definitely be investigated and prosecuted if found guilty.

However, many stakeholders still believe that Gwarzo has restored sanity to the capital market and maintained an enviable zero tolerance policy against market infractions.

Dr Adi Bongo of the Lagos Business School notes that the Director-General of SEC was supposed to be the epitome of good governance in the country, so, according Bongo flouting corporate governance rules shows that there is something critically wrong with the regulatory governance system. He added that the problem is the disposition of individuals and once they are bent on breaking the rules, there is nothing the system can do to stop them. ‘What happened with Gwazo shows that our rules are still very weak’ he observes.

As far as Emma Nwosu, a former bank Chief Executive Officer of now defunct ACB Bank, is concerned, Institutions in any country cannot operate above society’s cultural values. In Nigeria there is corruption, Nepotism among other cultural decays. According to him ‘there is no way this will not filter into the institutions, public offices and private sector.’

The man Gwarzo

Mounir H. Gwarzo became the Director General of the Securities and Exchange Commission (SEC) in May 2015 and Chairs the Africa Middle East Regional Committee (AMERC) of the International Organization of Securities Commissions (IOSCO). He had previously served on the SEC Board as Executive Commissioner in charge of Operations from January 2013 before being appointed Director General by the President. Prior to joining the SEC Mr. Gwarzo led the Capital Market initiatives of the Federal Mortgage Bank of Nigeria (FMBN) where he facilitated the issuance of Nigeria’s first ever mortgage-backed bond.

Mr. Gwarzo started his career at the Kano State Ministry of Trade and Commerce in 1988 and proceeded to garner a uniquely rich blend of experience as an operator and a regulator. He has worked in well-established institutions in Nigeria’s financial services industry including the Nigerian Stock Exchange (NSE), Century Merchant Bank, Empire Securities Limited and MTL Global Investment Limited. In 1999, he joined the SEC working directly with the then-Director General before heading the Commission’s Investment Division.

Mr. Gwarzo has attended Advanced Management programs at INSEAD and SAID Business School. He has is a fellow of the Chartered Institute of Stockbrokers (CIS) since 2000. He obtained a Post Graduate Diploma in Development Finance from the University of Birmingham, UK in 1991 and a Bachelors of Science Degree in Economics from Bayero University Kano in 1987.

In the course of his career, Mr. Gwarzo has delivered more than 25 papers at different seminars and workshops. He has served on about 20 high level Committees either as Chairman or Member receiving commendations for exemplary service and uncommon leadership. He devotes his time to pushing for greater visibility for African and Middle Eastern capital markets as well as pushing for greater financial inclusion for all Nigerians.

 

© 2017, Hallmarknews. All rights reserved. Reference and link to this site is required if you wish to reuse any article.

Reactions from Facebook

comments and opinions

Leave a comment

XHTML: You can use these html tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Got news for us?

Most Shared

Recent posts

  • Afrinvest set to release 2018 Banking Sector Report on Oct. 22

    Afrinvest (West Africa) Ltd will on October 22, 2018, in Abuja present the 2018 edition of its Annual Nigeria Banking Sector Report to the public. The report titled “An Economic Agenda for a New Government” presents a viable economic roadmap for Nigeria in 2019 and will be launched at the Shehu Musa Yar’Adua Centre, Abuja. […]

  • UBA posts N79bn pre-tax profit for Q3 2018

    United Bank of Africa Plc retained a remarkable growth in profitability for the unaudited nine months financial result and accounts September 30, 2018, with profit before tax closing at N79 billion. The pan-African financial institution reported N78 billion amid a challenging environment. The financial institution in its result to The Nigerian Stock Exchange (NSE) on Tuesday also […]

  • Inflation rate accelerates to 11.28% in Sept

    The Consumer Price Index, (CPI) which measured inflation for September increased to 11.28 per cent (year-on-year) from 11.23 per cent recorded in August, the National Bureau of Statistics (NBS) said on Tuesday. Latest inflation data from for September released by the NBS in Abuja showed that inflation rate was 0.05 per cent points higher than […]

  • Medium, large capitalized stocks return bulls to equity market

    Gains recorded by medium and large capitalized stocks helped the Nigerian Stock market to reverse Monday’s negative sentiment, appreciating 0.95 per cent on Tuesday. The All Share Index (ASI) increased by 308.70 absolute points, representing an increase of 0.95 per cent close to 32,722.18 points. Also, the Market Capitalization was up N112.70 billion, which was […]

  • NSE Wins Best Use of Technology for Efficiency Award

    The Nigerian Stock Exchange (NSE) has received the 2018 Best Use of Technology for Efficiency Award from Nigeria Tech Innovation & Telecom Awards 2018 (NTITA). The NTITTA is the most celebrated industry awards for the Technology and Telecom industries attracting top decision makers in the sectors. The annual event is held to showcase excellence and celebrate the continued growth […]

  • Super Eagles beat Libya, top Group E

    The Super Eagles now stay at the top of their group standings as they endured a scare in Tunisia to claim a third consecutive victory An Odion Ighalo-inspired Nigeria secured a 3-2 victory over Libya to move to the top of Group E in their 2019 African Cup of Nations qualifiers in Sfax. Goal.com reports […]

  • NDLEA FCT nabs 147 drug dealers, seizes $1.9m in one month

    The National Drug Law Enforcement Agency (NDLEA), FCT Command, said on Tuesday that it arrested 147 suspected drug dealers and seized various consignment of drugs. Mrs Chinyere Obijuru, Commander, NDLEA FCT Command, told newsmen in Abuja that the command in its sting operation that commenced on September 1, also seized fake 100 dollar bills amounting […]

  • PENGASSN tasks govt on quick minimum wage resolution

    The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has urged the Federal, state governments and organised private sector to resolve the differences in the ongoing negotiation for a new minimum wage in the country. The National President of the Union, Mr Olabode Johnson made the appeal while addressing newsmen on its planned […]

  • Court nullifies Unity Bank Executive Director’s sack

    The National Industrial Court, sitting in Ikoyi, Lagos State, on Monday voided the termination of employment of Mrs Arese Alonge, declaring her a subsisting Executive Director of Unity Bank. The court ordered the bank to pay all entitlements and benefits that pertain to her office. Alonge had on Feb. 11, 2015 instituted a suit against […]

  • Traders tasks politicians on accountability

    The National Association of Nigerian Traders (NANTS) has called for accountability from in-coming governments, insisting that they must keep their promises. President of the association, Mr Ken Ukaoha, made the call at the public presentation of “Framers Manifesto and Traders Charter Demands’’ in Abuja on Monday. “We are gradually coming back to our senses to […]

  • Kayode Fayemi and the Ekiti conundrum

    By TESLIM SHITTA-BEY Ekiti state’s newly elected governor Kayode Fayemi is a brilliant conversationalist and an engaging debater. Nevertheless, with the state he is about to take over as governor locked within a time capsule of slow growth; the usually voluble gentleman will have no time for banter. According to Emmanuel Aremu indigene of Ondo […]

  • The Buhari era:  How the president is reshaping Nigeria after his own image

     By AYOOLA OLAOLUWA On May 29, 2015, President Muhammadu Buhari assumed office, and there were great expectations from Nigerians. While campaigning, the Daura-born president centred his campaign on five focal points: building the nation’s infrastructures, job creation, revamping the economy, providing security and fighting corruption. After 16 years of dashed hopes under successive Peoples Democratic […]

  • Economy : IMF forecast signposts tougher times

    By FELIX OLOYEDE  Experts have noted that the reduction in the International Monetary Fund’s (IMF) growth outlook for the Nigerian economy in 2018 presages a rise in the jobless rate as the economy head into a new year.  The IMF cut the country’s growth projections for this year from 2.1percent to 1.9 percent, arguing that […]

  • Tinubu launches early start to 2023 bid

    By OBINNA EZUGWU  Having, in his reckoning, secured the structure of the ruling All Progressive Congress with his long time ally, Comrade Adams Oshiomhole as chairman, and President Muhammadu Buhari now guaranteed to run for second term in office, and quite possibly, retain power, former Lagos governor, Senator Bola Ahmed Tinubu have begun strategic positioning […]

  • 2019: Peter Obi’s choice ruffle feathers

    By OBINNA EZUGWU  The emergence of former vice president, Alhaji Atiku Abubakar as presidential candidate of the People’s Democratic Party (PDP) dominated the political space last week. Many have continued to argue that the former vice president remained the only candidate with the requisite resources, reach and experience to defeat the incumbent President Muhammadu Buhari […]

  • APC primaries: Party crisis may consume Oshiomhole

    By OBINNA EZUGWU National Chairman of the All Progressives Congress, Comrade Adams Oshiomhole did apparently, make a kill with the recently concluded primary elections of the ruling party. Nomination and expression of interest forms were sold at exorbitant prices – ranging from N45million for presidency to N850,000 for state House of Assembly – and many […]



read more...