At an investigative hearing organised by House of Representatives Committee on Capital Market and Institutions on the issue, the minister said that the suspension was in line with public service rules.
She said that the action became necessary in order to sustain the confidence of investors and safeguard the integrity of the Nigerian capital market.
The minister alleged that Gwarzo was a director in a private company while in office as the DG of the commision, thereby violating public service rules.
“Mr Munir was suspended in accordance with the Public Service Rules (PSRs) 03405 and 03406,” she said.
According to her, the Investment and Security Act empowers the minister to act in absence of the board.
The minister explained that the suspension was to allow unhindered investigation into several allegations of financial impropriety against Gwarzo.
She said that it was alleged that the former director-general paid himself N104 million as severance package after he was appointed from the position of a Director in the same commission.
She said that the act contravened civil service standing rule that severance benefit could only be paid to an employee who had concluded his or her service or had completely disengaged from service.
On the allegations linking Gwarzo’s suspension to the forensic audit being conducted on Oando and Oasis Insurance Companies, Adeosun said “it is mischief to link the matter to Oando”.
She noted that the forensic investigation on the companies was still ongoing and that she was not interfering in it.
But, Gwarzo challenged the powers of the minister to suspend him, alleging that he was being hunted for investigating Oando and Oasis Insurance companies.
He alleged that the level of interference in the activities of the commission by the minister had never been recorded in the history of the organisation.
Gwarzo alleged that Adeosun had told him before his suspension to stop the forensic audit on Oando and Oasis insurance companies.
He accused the minister of having special interest in those companies.
Gwarzo said that he had resigned as director of the private company since 2012, adding that proper documentation of his resignation was the responsibility of the company’s secretary.
He said it was not his duty to ensure that his name was removed from nominal roll of the company by the management.
Head of Media Division of SEC, Mr Abdulsalam Naif-Habu and Head, Legal Department, Mr Anastasia Braimoh, were suspended along with Gwarzo.
In his remarks, Chairman of the committee, Rep. Tajudeen Yusuf (Kogi-APC), said the committee would reconvene with all affected parties for further hearing on a later date.