SEC chairman, Thilak Karunaratne told Vimasuma that some brokers and investors had become powerful enough to influence his resignation.
"Imagine how powerful they must be for them to influence me to resign," Karunaratne told Vimasuma.com.
The SEC has been probing so-called 'pump and dump' fraud where fundamentally weak stocks were driven up and sold to small investors during a stock market bubble fired by lower interest rates and liquidity from margin loans.
Karunaratne says his decision to continue investigations on fraudulent transactions resulted in pressure being created for his resignation.
His predecessor, Indrani Sugathadasa, also resigned late last year, amid pressure from some brokers and high net worth investors.
Karunaratne said as a Sri Lankan he wished the market well.