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Bond Scam Sri Lanka

Minister Ravi Karunanayake should resign – Dr Paikiasothy Saravanamuttu

Image: Minister Karunanayake checking his nose to make sure is it growing!

The Centre for Policy Alternatives (CPA) has followed recent media reports of the proceedings of the Commission of Inquiry to investigate the issuance of Treasury Bonds with increasing concern. The reported allegations of financial misconduct and conflicts of interest are extremely serious and their political consequences graver. Whatever the outcome of the Commission’s proceedings., the allegations are of sufficient gravity to require the immediate resignation of Ravi Karunanayake MP, the Minister of Foreign Affairs.

The media reports of the on-going hearings of the Commission of Inquiry to investigate and inquire into the issuance of Treasury Bonds during the period of 1st February 2015 to 31st March 2016, (CoI), reveal that Mr Karunanayake is implicated in financial transactions with Mr Arjun Aloysius, a central figure in the high-profile and questionable issuance of bonds by the Central Bank. Witness testimony to the CoI states that a luxury apartment in Colombo was taken on lease by Mr. Aloysius and/or his representatives, and paid for on behalf of Karunanayake, who was then Minister of Finance, and his family. In recorded testimony given to the CoI on 2nd August 2017, Minister Karunanayake noted that it was his wife and daughter who found and procured this apartment and that he personally “knew nothing” about how the apartment he and his family resided in for nine months was paid for and procured.

Without prejudice to the proceedings of the CoI, CPA finds the Minister’s testimony not only entirely implausible, but also deeply damaging to the credibility and reputation of the institutions of government.

This is especially so for a government elected on a platform of good governance and anti-corruption. We firmly believe that this is a view shared by the majority of our fellow citizens, who are dismayed by the persistence of corruption and the current government’s woefully inadequate measures to address it.

CPA wishes to remind the government of its central promise to eradicate corruption at all levels of government and to hold to account anyone who is complicit without fear or favour. We call upon Minister Karunanayake to take the principled step of resigning from ministerial office forthwith, and to cooperate fully with on-going and any future investigations. We believe this is an essential prerequisite for restoring public confidence in the government’s commitment to its mandate, and we reiterate that the failure to do so will seriously impede the realisation of every other aspect of the government’s reform agenda.

Given the hope and expectation raised in 2015 regarding the restoration of good governance and the rule of law, the failure of Minister Karunanayake to resign, and the failure of the government to ensure his resignation, will risk unfavourable comparison with its predecessors. More critically, it will erode the credibility of our public institutions and processes in the eyes of citizens, and fatally undermine broader reforms.

Dr Paikiasothy Saravanamuttu
Executive Director

August 04th 2017, Colombo, Sri Lanka:

Bond Scam Sri Lanka

Bond Scam : 5 years later public still waiting for concrete action

Five years have elapsed since Sri Lanka’s largest financial scam, the Central Bank bond scam, took place.

On the 27th of February 2015 – exactly five years ago – deviation from due process and manipulation resulted in the Largest Financial Scam to take place in Sri Lankan history – which is known as the Bond Scam.

The parties embroiled in the scam are :
* Fugitive Ex-Central Bank Governor Arjuna Mahendran
* Perpetual Treasuries Limited
* Beneficial Owner of PTL Arjun Aloysius
* CEO of PTL Kasun Palisena

Many others including Ex-Prime Minister Ranil Wickremesinghe, Ex-Ministers in the UNP led Government of Good Governance, as well as MPs were alleged to have been involved in the events surrounding the scam and to have obtained pay-offs from the main perpetrators.

Five years ago today, the Central Bank of Sri Lanka advertised for 01 Billion Rupees. However, Ex-Governor Mahendran decided to accept 10 Billion Rupees toning down from his previous decision to accept all the bids, which amount to just north of 20 Billion Rupees.

Perpetual treasuries ended up with the lion’s share of the Rs 10 Billion and part of it was achieved at an extraordinarily high rate.

For two years, the decision was defended by several quarters with the appointment of committees and it was criticized by others, especially by the Parliamentary Watchdog COPE.

While all this was taking place, in March 2016 the second bond scam took place and it is yet to be investigated. The 2016 COPE investigation led by Sunil Handunnetti found Former Governor Arjuna Mahendran directly responsible for the controversial bond transaction.

As nothing transpired Former President Maithripala Sirisena appointed a Presidential Commission of Inquiry in 2017 which found Arjuna Mahendran, Arjun Aloysius, Kasun Palisena, Perpetual Treasuries Limited and relevant officers of CBSL and the EPF are parties to and directly responsible for the offense.

Aloysius and Palisena were arrested and remanded and later granted bail, while Mahendran remains in hiding despite measures for extradition in play.

According to experts, the people of Sri Lanka will have to pay for the sins of the perpetrators for another 30 years as the losses would increase to an amount beyond imagine – despite the immediate loss being north of 600 Million Rupees.

Experts also say the loss of the Second Bond Scam of 2016 will be even greater and disastrous for the Sri Lankan people to cope with.

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Bond Scam Sri Lanka

This land of glorious promise and perpetual failures – Kishali Pinto Jayawardene

Image: UNP Prime Minister (Ranil Wickremesinghe) and his inner coterie had not robbed the Central Bank of Sri Lanka …

As Sri Lanka’s Presidential election counts down to a tense culmination in two weeks, let us have the comfort of imagining in a parallel and more hopeful universe, that following the crushing defeat of the Rajapaksas in 2015, its newly formed ‘Pohottuwa’ Party had cleansed its ranks of the highly corrupt, the highly murderous and the highly racist, modeling itself on the lotus bud that it had chosen as its symbol.

Cruelly cynical electoral betrayals

As many would cackle, this would perchance have been wondrously impossible, given the political miscreants who broke away from the Sri Lanka Freedom Party (SLFP) alliance with the victorious United National Party (UNP). But then, as all religions proclaim with solemnity, even the worst sinner among us can be reformed, So such a reform process might have occurred, albeit as unlikely as that may be.

Let us also imagine that, on the other side of this political divide, the good governance UNP Prime Minister (Ranil Wickremesinghe) and his inner coterie had not robbed the Central Bank of Sri Lanka scarcely before the lights of that grave swearing-in ceremony of a new regime at Independence Square had dimmed and indulged in that cruelly cynical joke again, one year later. Or that, the new President (Maithripala Sirisena) had not brought in rejected political jokers in the SLFP to Parliament through the device of the National List.

For that matter, it does no harm to further hope that ‘good governance’ supporters would have had the good sense not to frolic in legal cloud cuckoo land, (which some are still nostalgically lingering in), and engage in a policy of ‘see no evil, hear no evil, talk no evil’ until ‘yahapalanaya’ misdeeds became too deafening to ignore. Given chronic political instability at the time, the worst possible miscalculation was to plan sweeping constitutional or transitional justice reforms in select huddles without engaging core electoral constituencies in the South. Other questions remain outstanding. Why was a ‘yahapalanaya’ styled draft Counter Terrorism Act pushed for and why did ordinarily vociferous opinion lobbies tiptoe around its highly problematic clauses? If it was a Rajapaksa Presidency which had proposed this draft, would not the uproar have been immediate?

Do we laugh or do we cry?

In the North and East, indignation of war victims was left to smolder. At the end of four years, let alone major corruption scandals, not even emblematic cases of gross human rights killings of aid workers and students in Mutur and Trincomalee, the assassinations of editors and others who had incurred Rajapaksa wrath, were properly dealt with. The crowning folly was the criminal dereliction of duties by security and intelligence officials running helter skelter between a hostile President and Prime Minister resulting in the April jihadist attacks on churches and hotels. Is there any other country in the world where an Inspector General of Police (IGP) is indicted for murder but not dismissed from his post through mandated parliamentary procedure or where the Chief of the Police Financial Crimes Investigation Division (FCID) is himself investigated for money laundering? Do we laugh or do we (fittingly) cry?

So when Ministers supporting the UNP led alliance’s Presidential candidate Sajith Premadasa complain bitterly of ‘Rajapaksa moles’ in the FCID, in the Attorney General’s Department and acting as erstwhile Ministers of Justice as well as Law and Order no less, this is sheer tomfoolery. The point is not that these claims are not true. But are we asked to believe that the political leadership did not know that these charades were taking place under its very nose? Or did it know and did it collude in the expectation of a divide and rule policy aimed at bifurcating its political opposition? Which is worse, monumental incompetence or diabolical machinations on the part of those holding the reins of State? Or was it a unpleasant mixture of both? Maybe it scarcely matters anymore.

But politicians should not parrot deceptive refrains of being ‘on the path to good governance’ with which the public was hood winked in 2015. This is the deeply unenviable extrication of himself from ‘yahapalanaya’ failures that confronts Premadasa. On the other hand, ghosts of the past haunts ‘Pohottuwa’ contender Gotabhaya Rajapaksa despite ads projecting him to be a silver haired elder to whose tender care, the nation can be safely entrusted. This is a beast-in-waiting, quiet and deceptively benevolent but with the potential of unleashing extraordinary fury once State power is captured.

Rude caricature of a poll

Sharp and critical choices need to be made. The angry throwing up of hands at stupidities of Presidential candidates or a useless opting for ‘independent candidates’ is an indulgence that we cannot afford. As promising as they appear to be, these ‘independents’ are only bartering for a vote that will be wasted. Their emergence would have been greatly relevant as a ‘third force’ in a General Election but not now.

In fact, this has become a rude caricature of a presidential poll, ranging from an overlong ballot paper including ‘independents’ on which millions of public funds are wasted to each manifesto outdoing the other in terms of handouts and little focus on the Rule of Law excepting bland assurances. Meanwhile we have a President’s Counsel of ‘Pohottuwa’ colours warning Muslims that if they did not support his candidate, they would have to face ‘retribution’, couched in colourful language as it were. Is this the level to which this country’s legal profession has sunk to?

What is the point of the Supreme Court decreeing guidelines as to who will be conferred ‘silk’ with such ugly professional conduct becoming the norm? I suppose that question is redundant given the politicisation of civil society, the judiciary and once respected legal and medical professions. This is a cancerous growth, corrupting the country’s democratic progress. It must be exposed and ruthlessly ripped out.

Of foolish dreams and false starts

This is why Sri Lanka has been a country of poignant false starts, of glorious promises and abruptly miserable endings, of numerous ‘ifs’, of citizens always dreaming foolishly that, just around that elusive corner will be the nation’s hope, the one man or woman who will pull them out of hopeless quicksands.. But the problem is not with one individual or a family. It is with systems, with institutions, with processes that have become irreversibly polluted, whether couched in liberal gobbledygook or in a dictator’s upraised finger.

Each time that we have elections, we loose that much more of the nation’s energy, its ability to hope and dream. Sri Lanka’s inimitable singer Sunil Perera warned recently that he would be exercising his vote this time, not out of an abundance of cheery optimism but out of an acute apprehension that he would be murdered in his bed if he chose wrongly.

Is this the melancholy choice that we are faced with, majority and minorities alike?

Courtesy  Sunday Times

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Bond Scam Sri Lanka

Royal victory for Sri Lanka PM Ranil Wickremesinghe

Image: Jubilant Prime Minister Ranil Wickremesinghe gestures along with Health Minister Dr. Rajitha Senaratne after the vote on the No Confidence Motion – AFP

Prime Minister Ranil Wickremsinghe yesterday emerged victorious after he managed to decisively defeat the much anticipated No-Confidence Motion with a comprehensive majority of 46 votes and will meet President Maithripala Sirisena today to decide the future of the government.

At the conclusion of a full day debate of nearly 12 hours Speaker Karu Jayasuriya moved the House for a vote on the motion. The motion against Prime Minister Wickremesinghe received 122 votes in favor and 76 votes against at a division by name. The division was called by Leader of the House Minister Lakshman Kiriella. A total of 26 MP were absent for the vote. Among them were two signatories to NCM Nishantha Muthuhettigama and Karder Musthan.

The UNF voted against the motion in a show of strength, backing the Premier with even dissident MP Wijedasa Rajapakse closing ranks unexpectedly. The minority parties led TNA, SLMC ACMC, Mano Ganesan and P. Digambaram (TPA), who are part of the UNF, bolstered the support for the Prime Minister by voting against the No-Confidence motion. There was eleventh hour change of heart from vocal State Ministers Wasantha Senanayake and Palitha Ranga Bandara as they voted against Motion.

However, as promised, the six members of the JVP voted in favor of the motion. Former President Mahinda Rajapaksa who was absent during the debate, voted in favor of the motion, along with his brother MP Chamal Rajapaksa and son MP Namal Rajapaksa.

Independent MPs Athureliya Rathana Thero and Arumugam Thondaman were absent for the vote.

The SLFPers who voted in favor of the motion included Parliamentarians Susil Premajayantha, Dayasiri Jayasekara, Dilan Perera, John Seneviratne, Lakshman Wasantha Perera, Dr. Sudarshani Fernandopulle, Tharanath Basnayake, Susantha Punchinilame, Anura Yapa, S. B. Dissanayake, Lakshman Yapa Abeywardena, Chandima Weerakkody, Anuradha Jayaratne and Sumedha Jayasena.

Notable SLFP Members of the Government who were absent included Mahinda Amaraweera, Sarath Amunugama, Nimal Siripala De Silva, Duminda Dissanayake, Faizer Mustapha, Ranjith Siyambalapitiya, Wijith Wijyamuni Zoysa, Piyasasena Gamage, Mohan Lal Grero, Sriyani Wijewickrama, MALM Hisbullah, AHM Fowzie, Lasantha Alagiyawanna, Manusha Nanayakkara, Nishantha Mutuhettigama, Indika Bandaranayake and Weerakumara Dissanayake.

The No-Confidence Motion was handed over to the Speaker by the Joint Opposition led by former President Rajapaksa on 21 March carrying the signatures of 55MPs including four SLFP members in the Government ranks. The defeat of the motion ended a 14 days game of cat-and-mouse between the UNP and the Opposition, each trying to garner the required numbers to secure a simple majority of 113 votes.

The vote was called for by Speaker Karu Jayasuriya at 9.30 and finished at 10.00pm. Soon after his victory, a jubilant Prime Minister speaking at a press conference said that the coalition government was still intact and the January 8 mandate must be fulfilled. “A group of MPs abandoned the Government today but we will continue with the rest. I will be meeting the President on Friday on how we are to move forward and discuss the future of the government. The national government will continue. The January 8 mandate given by the people must be fulfilled. We will also be making changes in the UNP. Reforms in the party will be carried out and reorganized,” the Prime Minister said.

Wickremesinghe’s first visit from Parliament was to the Gangaramaya Temple where he worshiped and sought blessings. Soon after the vote the city celebrated with crackers too. Earlier on in the day, a group of senior SLFPers addressing a media briefing at the Parliamentary complex affirmed that President Maithripala Sirisena was the head of the Government and that they would remain in their positions in the Government ranks even though they would vote in favor of the Motion. “It is the President who decides whether we should hold Ministerial positions, not the UNP,” Minister S B Dissnanayake said. Ministers Dayasiri Perera, John Seneviratne, Lakshman Wasantha Perera, Sudarshini Fernandopulle, Tharanath Basnayake, Dilan Perera, Susantha Punchinilame, Anura Priyadarshana Yapa, Susil Premajayantha, Lakshman Yapa Abeywardena, Chanmdima Weerakkody, Sumedha G Jayasena and Anuradha Jayaratne were also present at the media briefing. UPFA joint opposition parliament group leader, Dinesh Gunawardena moved the motion against the Prime Minister Ranil Wickremesinghe in Parliament yesterday morning kicking off the debate.

Taking up the no-confidence motion signed by 55 MPs including four MPs from the Sri Lanka Freedom Party (SLFP) for debate, MP Gunawardena said: “There is no confidence in the Prime Minister. Whether the house has confidence in the Prime Minister or not is a very serious issue. This Government took over on the 8th March for the first time and the Central Bank came under the purview of the Prime Minister. Then a Singapore citizen was appointed to head the Central Bank. There is only one Central Bank in the country and it is a known fact that its governor has the power to influence the country’s economy. The Central Bank, which is traditionally under the Finance Ministry was taken away from the Finance Ministry. Knowing that he would not comply with the country’s accepted financial norms.” Challenging the appointment of former Central Bank Governor Arjun Mahandran he said: “Mahendran was appointed as the Governor knowing that he would not comply with the country’s accepted financial norms under the purview of the Prime Minister. The Prime Minister recommended the appointment of Mahendran and took on the responsibility, which he accepted in parliament.” MP Gunawardena also noted that by appointing Arjuna Mahendran as the Central Bank Governor, the faith in the country’s foremost financial institution has been lost and led the nation to incur heavy losses from malpractices involving the shady deals with the Perpetual Treasuries. “Those responsible cannot escape from their misdeeds. Because of this incident, the Finance Minister had to resign from his post. Those responsible cannot be made to appear innocent,” he added. Minister of Public Enterprise and Kandy Development and Leader of the House of Parliament Lakshman Kiriella rejecting the charges on the Prime Minister said the NCM was brought on baseless allegations.

“Both times when PM Wickremesinghe took office, he appointed an MP from the Opposition as the COPE Chairman. In 2002 it was late Jeyaraj Fernandopullei and it is Sunil Handunnetti of the JVP at present. He also established oversight committees and appointed MPs from the Opposition and the ruling party. He did all these to suggest that the government has nothing to hide. ” Minister Kiriella added. He then highlighted the involvement of the joint opposition MPs in the recent violence against Muslims in certain parts of the country.

“The police were in possession of information on outsiders flocking into Kandy two days prior to Digana incident. I gave a telephone call to the police informing them about the situation and requested them to be vigilant. Six Sri Lanka Podujana Peramuna politicians are behind the recent tense situation in Kandy. Among them, there are two SLPP parliamentarians as well. We do accept that there have been lapses from the part of police with regards to this incident. The police had already received information on outsiders coming to Kandy in groups. But the police did not act on these. Some police stations were very much dedicated in curbing the situation, whereas, some were inactive.” Minister Kiriella said. “So, how could the JO allege that the PM is responsible for that?” he queried Joining the debate, the Leader of the Opposition Rajavarothiam Sampanthan rejected corruption. “With regard to the Central Bank bond scam, consequent to investigations two persons are in custody and a warrant is issued against a third person and investigations are proceeding. No one should be spared, and the rule of law should be implemented irrespective of who they are.” “The motion of No-Confidence seeks to implicate the prime minister with the bond scam. Statements of actions of a general nature are thought to be used in an attempt to implicate the prime minister with the bond scam. The wording of the motion and the timing of the motion are indicative of a pursuit of a political agenda through the motion rather than fixing responsibility with regard to the bond scam,” he said. “The question must be raised as to why the wording is so weak lacking in any specific charge against the prime minister pertaining to the band scam per say. Why should this motion be brought now? The wording of the NCM is too loose and too general in nature. It could be that the Prime Minister is facing this situation because of the confidence he placed in someone who betrayed him. Where is the evidence or charge against the Prime Minister of involvement in the bond scam per say? Is the wording of the NCM so loose and so general because of the lack of specific material against the Prime Minister in regard to the bond scam? If that is so, in my submission the motion lacks credibility. With regard to the timing of the motion, this bond scam occurred three years ago, and it has been the subject of public focus for a long time, so why has this NCM brought against the PM only now? This is a plan to bring down, totally and completely, the present government,” added MP Sampanthan.

According to MP Sumanthiran, the no-confidence motion against the Prime Minister is the first step in the assault against the government of national unity that has the popular peoples mandate. “Perhaps the second would be aimed at the Speaker’s Chair and the third impeaching the President himself. Now that design goes against the mandate of the people of this country from all parts and all communities granted mainly to the two main parties. This Government has received a mandate in particular from the people to fight corruption. In 2015 Presidential election one of the key issues pronounced and people selected a common candidate to fight corruption. There were very serious issues that this country had to face and then get addressed, resolved and the direction of the country to be changed. Persons from varied different political backgrounds joined hands in this exercise.” “All of us worked together and brought about this change. Thereafter the General elections led to form the national unity government. Unfortunately, some who were elected from the UPFA decided to go against that mandate and left the Government of national unity and chose to sit in the opposition. It was the first challenge posed to the national unity government. Today, that group of MPs who worked against the mandate received has preferred a no-confidence motion against the Prime Minister,” he added.

Meanwhile, the Sri Lanka Muslim Congress (SLMC) claimed the No-Confidence motion was another attempt by the Joint Opposition to remove the Premier Wickremesinghe from the 2020 Presidential election race. SLMC leader Minister Rauf Hakeem made these remarks while taking part in yesterday’s debate on the No-Confidence motion. “The SLMC stands with the Prime Minister against the motion and it considers the motion as an attack on the government. The Prime Minister is only a symbol. They just want to damage the government,” he said.He then said that the Sri Lanka Podujana Peramuna was utilizing the suffering of the muslim community to their political advantage.

“The Sri Lanka Podujana Peramuna (SLPP) is attempting to take advantage of the sufferings of the Muslim people and are trying to use it to influence the Muslim MPs. There are attempts to manipulate the SLMC and the Tamil National Alliance (TNA) by those behind the NCM claiming that the government has not been able to guarantee the safety of the minorities.

“For them the suffering of the Muslims is just another factor to manipulate. The shock, the suffering and the damages of the Muslim community has been used to compel Muslim MPs to vote against the Prime Minister. They have also tried to use a speech made by one of our MPs criticizing the response to the Digana communal violence and are trying to convince people that we must vote against the government,” he said.”

UNP demands PM remove Ministers who voted in favour of NCM

A group of 33 United National Party (UNP) MPs yesterday (4 April) urged Prime Minister Ranil Wickremesinghe to remove Ministers who voted in favour of the No-Confidence Motion, insisting that it was ‘despicable’ and was against the people’s mandate given in 2015.

The letter signed by UNP MPs requested Premier Wickremesinghe to remove Ministers S. B. Dissanayake, Dayasiri Jayasekara, Susil Premajayantha, Anura Priyadarshana Yapa, Chandima Weerakkody and John Seneviratne, who voted against him yesterday at the No-Confidence Motion.

While the majority of the Government members were working towards a common goal of developing the country, the UNP MPs claimed, this group of Ministers had been constantly disrupting the work and criticising the Cabinet decisions in a loathsome manner in the media.

“This group of Ministers within the Government had always undermined the mandate given by the people in 2015,” the UNP MPs charged.

By Skandha Gunasekara and Ashwin Hemmathagama

Daily FT.

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