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SEC And The Gwarzo Scenario



“Truth is incontrovertible. Panic may resent it, ignorance may deride it, malice may distort it, but there it is” – Winston Churchill. Several months after the suspension of the former director general of the Securities and Exchange Commission (SEC), Mallam Mounir Gwarzo from office over allegations of abuse of office, it is nauseating that scores of supposed opinion writers have continued to inundate the public with well-crafted but logically insipid reasons the decisions to make him step aside should not hold.

A particularly disgusting trend in the opinion articles is that rather than critically appraise the circumstances that led to the suspension of the former SEC boss from a dispassionate analytical prism, most of the writers have consistently taken position against the government, vilified the minister of finance, accused the new management of complicity and others who, in their views, supported the decision, all in their desperate efforts to dress the ‘accused’ in a saintly garb of a ‘faithful’ servant.

But then, the question that ordinarily should have pre-occupied the thoughts of those behind the media campaigns, which some analysts have tagged ‘sponsored copies in the guise of opinion articles’ is: did the suspended SEC boss really breach any extant law, public service rules or corporate governance principles while discharging his roles as the director general of the commission?

Crucial to the current discourse on the trials of Gwarzo are issues relating to his roles in contracts awarded to some companies during his tenure, some of which he allegedly owns shares in or in which his wife is believed to have interests. Is it true, as alleged, that the suspended SEC boss abused his office and violated the provisions of Sections 57 (12) (b) and 58 (5) of the Public Procurement Act, 2007 in the awards of contracts during his tenure?
The Federal Government’s Administrative Panel of Inquiry, last December, recommended Gwarzo’s dismissal, as director-general of the Securities and Exchange Commission (SEC), from the Public Service.

This, it said, is in line with “PSR 030402 (in relation to the allegation on Golden Handshake), having breached paragraphs 313 and 316(4) of the Financial Regulations (Government Notice No. 219 of 27th October, 2009)(engaging in extra budgetary expenditure without appropriate approval).”

Among others, Administrative Panel of Inquiry (API) set up by the Minister of Finance, recommended that Gwarzo be referred to the ICPC for further investigation of the allegation of abusing his office to award contracts to Outbound Investments Limited, contrary to the provisions of Sections 57 (12) (b) and 58 (5) of the Public Procurement Act, 2007. The report said to have been submitted to Mrs. Adeosun, directed, among others, that Gwarzo should refund the sum of N104, 851,154.94, being the severance package he illegally approved for himself and received.

“Holding of the position of the director-general of SEC as well as a director in two private companies (Medusa Investment Limited and Outbound Investments Limited) was in breach of public service rule 030424, public service rule 030402 and Section 6 of the Investment and Securities Act, ISA 2007.”

Upshot Reports quoted the report as saying, “The Panel advised the Federal Government to re-orientate public servants to the very fact that the Public Service Rules and Financial Regulations are ground norms of every Government Service Contract, be it at the Federal, State or Local Government levels. It added, “Accordingly, all Government Extra-Ministerial Departments and Agencies should be made to understand that the PSR and FR are superior to whatever specific legislations and domestic arrangements that guide their operations, except when such issues were not covered by any provision of the PSR.”

While some of the commentators have consistently argued that the conducted inquiries into Gwarzo’s roles as the ‘chief accounting officer’ in SEC border on persecution of an innocent person, the reports and recommendations of the Administrative Panel of Inquiry set up by the minister had been published and supported with what could be termed incontrovertible facts as to why such recommendations were made. Haba! What are these whole hues and cries about ‘Gwarzo must stay’ media campaigns all about?

For now, it is also logical to say that rather than distracting the new management with frivolous insinuations and by desperately distorting the facts and deforming the issues, those at the forefront of the ‘Gwarzo must stay’ media campaigns should allow the new team to concentrate on its assignments.

What the public would want to see in the current efforts of the government to improve corporate governance in SEC under the latest team is people giving sound advice and remedial suggestions to help the team achieve its mandate. We have had enough of patently biased comments and opinions on the SEC matters that common sense demands that efforts should now be channeled more in making the commission stronger, better managed and more responsive to capital market investors’ needs.

Quite interestingly, one would like to state unequivocally that the best of options for Mallam Gwarzo to seek redress in the face of alleged ‘persecution’ is the path he has elected to tread and everyone that believes in truth should allow him to explore all legally accepted avenues to get justice.
Collins, a public affairs analyst, writes from Lagos