Culprits of Bond scam should be brought to book – Cabraal

Ajith Nivard Cabraal

The politicians and officials from top to bottom who were responsible for the Bond Scam should be brought to book and penalized, former Governor Central Bank (CBSL) and Economic Adviser to the Prime Minister, Ajith Nivard Cabraal said.

He was speaking at the launch of his book, ‘The great bond scam cover-up’ at Hotel Ramada last Friday (4), attended by politicians, public servants, business community and media personnel.

Cabraal, the 12th Governor of CBSL said the infamous bond scam came to light on February 27, 2015 and to date no action has been taken.

“The culprits were well guarded and protected, with a series of public hearings and commissions appointed to keep down the pressure from the public.

“However enough is enough and now I suggest to the new Government that a new and comprehensive legal inquiry be held soon and those responsible be named and shamed, deprived of their civic rights and put in prison,” he said.

He said, “there is ample evidence against former Prime Minister Ranil Wickremesinghe, former Governor Arjuna Mahendran, CBSL officials and others. Some politicians even received money for their political campaigns covering up the bond scam and they too should be penalized.”

If a similar scam came to light in the US the culprits would be already behind bars and if it happened in China some ‘master minds’ would be executed like in the Melamine (milk contamination) issue, Cabraal pointed out.

He recalled that CBSL in 2015 under Governor Arjuna Mahendran, advertised a bond of Rs 1 billion for 30 years and when the auction closed Mahendran ordered to take up twenty times that value – Rs 20 billion.

Perpetual Treasuries Ltd. (PTL) managed to get a loan of Rs. 10 billion, the fastest loan ever to be released, which helped PTL to own the lion’s share of the Rs 20 billion. Part of it was achieved at an extraordinarily high rate of 12.05% while the rate prevailing before the auction was in the region of 9.85%.

“Without influence and orders from the ‘top’ such a thing could not have taken place,” he said.

When there was a public uproar Prime Minister Wickremesinghe on March 17, 2015 made a speech in Parliament and said there were no ‘bond scams’ or ‘James Bond.”

He then appointed a three member committee comprising three UNP lawyers who cleared former Governor Mahendran of any wrongdoing.

Later the then Speaker Chamal Rajapaksa invited D.E.W. Gunasekera to be the Chairman of COPE to investigate the bond auction.

It was exposed that a key feature of the COPE report was that Arjuna Mahendran, under oath, stated that he had “only followed the Prime Minister’s instructions.”

“However, when the report was to be tabled in Parliament, it was dissolved on June 26, 2015 halting the publishing of the report. Three months following the parliamentary elections Sunil Handunetti was appointed as the Chairman of COPE.

In October 2016 the UNP members of COPE signed off the report but added footnotes challenging some of the conclusions in the report.

Cabraal said that the second bond scam happened in 2016 March and this time the CBSL through its funds allocated billions of rupees to PTL, without any security. In addition, all state banks and the EPF were told not to bid and here again the instruction to CBSL and state institutions came from the top. Subsequently, a Presidential Commission was appointed and a ‘FORENSIC AUDIT’ launched but it was of no avail.

“The Bond scam is a crime against the people of Sri Lanka and now it’s time to reopen this case and punish the wrongdoers and my book describes in detail all the findings”, Cabraal said. The former Governor thanked MP Vasudewa Nanayakkara, a former Deputy Governor of the Central Bank Dr. W.A. Wijewardena, former Ceylon Bank Employees’ Union President and civil society activist Rusiripala Tennakoon, former Chairman of the Securities Exchange Commission of Sri Lanka. Dr. Nalaka Godahwea and two media personalities, for continuing to pursue this incident.

(Source: Sunday Observer – By Shirajiv Sirimane)