The suspension was announced by Prime Minister Bernard Makuza.
Among those suspended included FARG's Executive Secretary, Jean Marie Vianney Karekezi.
Eugene Balikana, until then Permanent Secretary at the Ministry for Local Administration, has been named interim executive secretary of the Fund.
According to Rwandan daily newspaper, The New Times, investigations are underway into the embezzlement of the funds intended for the most impoverished of the survivors of the 1994 genocide.
The Department of Criminal Investigations (CID) was currently examining 17 cases, reported Thursday the newspaper, quoting the Prosecutor General, Martin Ngoga.
Created ten years ago, FARG, primarily financed by Rwandan government, and was responsible for constructing residences, health care and schooling of the impoverished survivors.
Blaming legal authorities, Karekezi had deplored escape of certain people suspected of being implicated in the funds' abuses, an accusation which had astonished the Prosecutor General.
Mr Ngoga claimed that he had convened himself late last year a joint meeting during which FARG had been invited to produce a suspects' list. However, to date the list has not been produced.
© Hirondelle News Agency