Opposition Leader Nimal Siripala de Silva yesterday warned that the national economy would suffer a staggering loss of approximately Rs. 9 billion unless the government cancelled the controversial Treasury bond issue involving Central Bank Governor Arjuna Mahendran and his son-in-law Arjun Aloysius.
Taking tangible measures to avoid Rs.9 bn loss would be as important as punishing those who had been involved in the fraud, De Silva said in a brief interview with ‘The Island.’
The Senior Vice President of the SLFP said that except crooks all agreed with the SLFP that the transaction should be immediately done away with and Mahendran removed pending an investigation.
The SLFP expected the Commission to Investigate Allegations of Bribery or Corruption to inquire into what he called the Mahendran Affair without further delay. The bond issue should receive the priority status, the Opposition Leader said.
Asked whether the SLFP had obtained President Maithripala Sirisena’s approval to push for Mahendran’s removal, MP de Silva said the President hadn’t been happy about the CB Governor’s appointment though he finally agreed consequent to an assurance given by no less a person than Prime Minister Ranil Wickremesinghe.
President Maithripala Sirisena ordered the appointment of a three-member committee to probe the alleged irregularities reported in the issue of 30-year one billion rupee Treasury Bonds by the Central Bank of Sri Lanka. The directive was given from London last week in spite of the government appointing another committee to investigate the same.
One didn’t need the skills of Sherlock Holmes to crack Mahendran’s case, therefore the SLFP expected the Bribery Commission to bring the case to a speedy conclusion the Badulla District MP said.
De Silva alleged that ‘insider trading’ had taken place in this particular transaction in which the Mahendran’s son-in-law’s firm was the beneficiary.
At the Treasury Bond Auction held on 27 February, the 30-year bonds were to be issued at a market rate of 9.5 per cent to raise Rs.1 billion. The issue was however closed at 12.5 per cent with the Bank accepting Rs.10 billion out of Rs. 20.7 billion bids received.
The Opposition Leader urged Premier and the Minister of Policy Planning and Economic Development Wickremesinghe, his deputy Dr. Harsha de Silva and Finance Minister Ravi Karunanayake to explain their stand on the controversial bond issue. They couldn’t side-step the issue, the Opposition Leader said, adding that the anti-corruption lawyer J. C. Weliamuna and former President of the Bar Association of Sri Lanka (BASL), Upul Jayasuriya too, should explain their position.
The Opposition Leader said that the government had been seeking assistance of India and some other countries and institutions to track down what it called hidden billions overseas by the previous government. In fact, the government had been making unsubstantiated allegations with an eye to the forthcoming parliamentary polls, MP de Silva said. However, the alleged fraud involving Central Bank Governor had exposed those who portrayed themselves as knights in shining armour fighting against corruption.
MP de Silva said that the country couldn’t ignore the fact that Mahendran had been a close associate of top LTTE financier Raj Rajaratnam now serving a prison term in the US for financial fraud and Finance Minister Ravi Karunanayake’s relationship with the convict.
When pointed out that Arjun Allosious had benefited immensely during the SLFP-led UPFA administration, too, de Silva said that the new government could investigate all fraudulent deals and take appropriate action against those responsible regardless of their present or past standing.
The Opposition Leader pointed out that presidential aide and attorney-at-law Shiral Lakthilake had lambasted the government for allowing Chairman of the UNP Malik Samarawickrema to join a decision making Central Bank meeting that paved the way for the controversial bond issue.
Lakthilake said that UNP Chairman couldn’t have joined that discussion under any circumstances.