The Senate Committee on Capital Market on Thursday commenced investigation into the allegation of illegal approval of N10 billion bond to Gombe State Government by the acting Director General of Securities and Exchange Commission (SEC), Mounir Gwarzo.

The decision followed the appearance of Gwarzo along with top officials of the commission before the committee during the commission’s 2015 budget defence.

During the defence, a member of the committee, Senator Magnus Abe, had alleged that Gwarzo who recently took over the headship of SEC from Arunma Oteh, hurriedly gave approval to Gombe State Government to secure N10 billion from the capital market, being the last tranche of N30 billion bond from which it had earlier secured N20 billion despite knowledge that the matter was pending before a competent court of law.

Abe had presented three newspapers and some documents to the committee to affirm the existence of a court case over the matter, saying it was curious that Gwarzo had hurriedly approved the bond just within two weeks of taking over from Oteh.

The allegation was further confirmed by a former governor of the state, Senator Danjuma Goje, who accused SEC of mortgaging the future of the people of Gombe State by arbitrarily approving the bond despite Gwarzo’s knowledge that the state had failed to satisfactorily utilise the earlier N20 billion it sourced from the capital market.

Goje said whereas Oteh deliberately refused to approve the bond because of the unsatisfactory report over the initial grant, Gwarzo quickly approved the balance barely two weeks after assuming office. “You ignored the petition and the cry of Gombe people and went ahead to approve additional N10 billion. The state has been mortgaged,” Goje alleged.

However, the SEC boss denied the allegation, saying when he took over, he set up a committee which went to Gombe to verify the projects executed with the earlier N20 billion approved and consequently recommended that approval be given.
He said all the committee members signed the report.

Gwarzo however, denied receiving any court order which challenged the legality of the bond, saying “SEC is a statutory body that complies with rules and regulations guiding its operations.”

Responding, the committee chairman, Senator Ayo Adeseun, demanded for a copy of the committee’s report, promising to study it with a view to sending a team of investigators to Gombe to verify the projects being executed with the bond.

The committee also queried SEC for spending all its internally generated revenue (IGR) in 2014 without appropriation by the National Assembly, describing it as a violation of the 2014 Appropriation Act which he said prohibited the commission from expending any money in the fiscal year.

The National Assembly had denied SEC appropriation in the 2014  budget following a crisis of confidence which brewed between its former director-general, Oteh, and the House of Representatives in 2012.

However, Gwarzo said the commission got approval to spend money from the House of Representatives’ Committee on Legislative Compliance but the lawmakers criticised him, arguing that a committee of the National Assembly lacked the power to amend the budget law.

Thisday