Gwarzo: SEC Board Approved Golden Handshake for Voluntary Retirees

The suspended Director-General (DG) of the Securities and Exchange Commission (SEC), Mr. Mounir Gwarzo, has defended the voluntary retirement scheme for some staff of the commission in 2015 christened the ‘Golden Handshake’, saying the board of SEC approved the exercise.

A panel of inquiry set up by the Minister of Finance, Mrs. Kemi Adeosun, to investigate alleged financial misconduct of the suspended DG had recommended his dismissal from public service, citing sundry violations, including the unilateral introduction of a voluntary retirement scheme with a cost implication of N1.7 billion.

However, reacting to the reported

introduction of the retirement exercise, Gwarzo said: “The Golden Handshake exercise was a voluntary retirement scheme designed by the commission for certain category of staff to exit the commission.”

He noted that as an incentive to access the scheme, staff were offered certain percentage of their allowances/remuneration, adding that the scheme was duly approved by the board of the commission at its meeting of March 12, 2015 and funded from the commission’s 2015 budget.

Gwarzo noted that Section 4 (1) (d) of the Investment and Securities Act (ISA), 2007 empowers the board of the commission the annual budget of the commission to consider and approve the annual budget of the commission as may be presented to it by the management.

“Thus, the board in exercise of its power as contained in the ISA approved the 2015 budget of the commission. Furthermore, Section 19 & 20 of the ISA (Appendix III) empowers the commission to establish and maintain a fund, the proceeds of which it may apply to meets its financial obligations.

“The effect of the provisions of the ISA cited above is that the commission is empowered to cater for all of its financial obligations from its funds. However, such amounts must be expended from a budget, which must be approved by the board of the commission.

“The funding of the ‘Golden Handshake’ was therefore carried out in line with this statutorily laid down procedure for disbursing the funds of the commission,” he said.

According to him, “adjustments were made to certain vote heads within the 2015 budget to accommodate the cost implication of the Golden Handshake exercise,” stressing that “this was necessary in lieu of the fact that the votes in majority of the heads adjusted were either meant to be disbursed for the welfare of staff or fund certain allowances of staff.”

The suspended SEC DG noted that in view of the fact that payment of a percentage of remuneration/allowances of a staff was an incentive to access the scheme, it was therefore imperative for these adjustments to be made.

Gwarzo added, “Furthermore, the action of the commission’s board in adjusting certain Heads in the 2015 budget is a power derived from the provisions of Section 12 (b) of the Interpretation Act(Appendix IV).  “The section provides that where an Act (ISA 2007) confers a power to make a subsidiary instrument (The Budget), proclamation or notification, the power shall include power, exercisable in the like manner and subject to the like consent power, conditions (if any), to vary and revoke the instrument, proclamation or notification,” he stated.

He observed that this allegation contained in the administrative panel report was never included in the query issued to him on November 3, 2017, the allegation contained in the suspension letter issued by the minister dated November 29, 2017 and the invitation letter given to him to appear before the panel on January 10, 2017.

“Therefore, on what basis did the committee included in its report when fair hearing was not given to me,” he queried.

An  administrative panel of inquiry set up by Adeosun, and headed  by the Permanent Secretary, Ministry of Finance,  Dr. Mahmoud Isa- Dutse, had among others found Gwarzo guilty of, among others, approving and collecting a severance pay of N104,851,154.94 for himself while still in the system.

He was said to have paid several millions of naira to firms linked to him in contravention of extant public service rules.