Mr Jones has the right to challenge the decision but it is yet to be determined whether he will fight for his job or leave the club. The board's move is effective immediately, but it is yet to finalise the timeframe for the punishment or if the decision will become permanent.

ARU boss Bill Pulver was in Canberra on Monday to meet with Brumbies chairman Robert Kennedy at Mr Kennedy's request as the ACT club tried to work through its issues and in the wake of a wide-ranging interview on the weekend that shocked the club's powerbrokers.

It is believed the interview contributed to an accelerated move by the disgruntled board to relieve Mr Jones of his duties, with board members growing increasingly frustrated in recent months.

The Brumbies board has decided not to sack Mr Jones or terminate his contract, and it is understood the club is not in a position to foot the bill for a payout should it cut ties with Mr Jones, who has almost two years to run on his deal.

There has been speculation the ARU could take the financial hit of the majority of Mr Jones' contract to help the Brumbies after the club reported a $1.68 million loss last year. Mr Jones was forecasting a $2.6 million turnaround by the end of 2016 to record a $1 million profit.

The decision to stand Mr Jones down leaves the parties at a stalemate, with Mr Jones of the belief he has done nothing wrong and he is being targeted because of his decision to hand transactions to the Australian Federal Police from the sale of the club's Griffith headquarters.

But the Brumbies refused to offer any official reasons for its decision to stand Mr Jones down other than releasing a brief statement that left fans scratching their heads.

However, the Brumbies board had asked Mr Jones not to comment on speculation and had been trying to help change the public perception of him.

The Brumbies have not looked for a replacement for Mr Jones, but club great Joe Roff has been floated as a potential candidate to fill a head of rugby role.

There has been tension in Brumbies ranks for months over certain decisions at the club and there have been heated board meetings, with the interview triggering the move to put Mr Jones on hiatus.

In the interview, Mr Jones claimed the Brumbies would cease to exist if he decided to fight back against those attacking him, questioned the club's investment in a new headquarters at the University of Canberra and called on internal stakeholders to "man up" and stop bowing to pressure of rumours.

The board has held several extraordinary meetings in recent weeks to discuss Mr Jones' future, and Mr Kennedy phoned Brumbies coach Stephen Larkham in South Africa to inform him of the latest developments.

Mr Jones did not return calls on Monday night, while Mr Kennedy did not want to comment further other than a brief statement sent to the club's members.

Mr Kennedy has been one of Mr Jones' strongest allies in recent weeks, and the board denied they were set to part ways with Mr Jones last week, with Mr Kennedy and Mr Jones working together on a plan to take the club into the future.

The AFP investigation is ongoing and it's understood Mr Jones has consulted his legal team of taking his own action against people "taking a hack at me".

The Brumbies board and some ARU senior figures were filthy with Mr Jones' comments on radio, which included the suggestion that the Brumbies were in danger of ceasing to exist and that the ARU would then be in breach of its Super Rugby agreement.

Speculation about Mr Jones' position has intensified in recent weeks and has ultimately led to the board taking action.

"It is with great regret that I informed Michael of the board's decision. However, I believe this decision is in the best long-term interests of the Brumbies," Mr Kennedy said in a statement.

"I also want to reassure our business partners, stakeholders, players, staff and members that the board as full confidence in the remaining executive management team within the Brumbies and our current financial position to continue operations through the 2016 season."

Community rugby official Craig Leseberg will step into an interim role to fill Mr Jones' shoes.

Mr Jones' lawyers and the Brumbies' legal team have spoken about possible outcomes. Mr Jones had become increasingly frustrated that he had been brought in to change the Brumbies, but was being singled out as a trouble maker for taking a strong stance for the club in negotiations of several deals.

There has been speculation for the pasts four months that Mr Jones' position has been precarious, and that he had fallen out with the Brumbies' key stakeholders.

In Mr Jones' stinging attack on his critics on Saturday, he claimed the rumours about his tenure were a "cancer" on the club and the Brumbies could cease to exist if he decided to fight fire with fire.

The tension has stemmed from the AFP investigation into transactions at the club between 2009 and 2013 relating to the sale of the club's Griffith headquarters.

University of Canberra vice-chancellor Stephen Parker has been considering legal action over an email from Mr Jones last year, and had requested copy of the transactions handed to the AFP.

It is not known whether Professor Parker will pursue the legal action now that has Jones has been stood down.

Mr Jones handed documents over to police after an independent audit of more than 50,000 emails at the club before it sold its Griffith headquarters for $11.375 million.

Mr Jones said he wasn't on a crusade or out to target individuals, but felt he had become the victim of a campaign against him because of the investigation.