The uncle, Jang Song Thaek, was considered instrumental in Kim's rise to power two years ago after the death of his father, Kim Jong Il. But the son turned against Jang earlier this month, having him executed on charges he tried to overthrow the government.
Agents at South Korea's National Intelligence Service, which broke news of Jang's fall from power before North Korea announced it, briefed lawmakers of a parliamentary intelligence committee Monday about what they think may have led to his downfall, CNN reported.
Based on the intelligence agency's analysis, Jang's aides in government agencies involved in business projects appeared to have overstepped their authority, creating conflicts with other agencies, said South Korean lawmaker Jeong Chung-rae, who attended the briefing.
The intelligence agency said it believes Kim may have demanded that the disputes be resolved and that Jang may have ignored the demand, Jeong told CNN.
"Jang was purged for violating the supreme leadership, according to the NIS report," Jeong said.
North Korea's state media had referred to business wrongdoing by Jang when outlining the grievances against him, CNN said.
"The Jang group put under its control the fields and units, which play an important role in the nation's economic development and the improvement of people's living in a crafty manner, making it impossible for the economic guidance organs, including the Cabinet, to perform their roles," the state news agency said in the official report on Jang's removal from his posts.