30 November, 2020

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Mr.Prime Minister, The Dollar Stops At Your Doorstep!

By Sarath de Alwis

Sarath De Alwis

Sarath De Alwis

People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.” – Adam Smith, Wealth of Nations

Things have not changed much since Adam Smith wrote the Wealth of Nations. We have a scandal tainted past. We cannot erase it. But we can put it right. Therefore we should insist that Mr. Ranil Wickremesinghe take responsibility for the scandal that has undermined the credibility of the reform agenda of President Maithrpala Sirisena.

Corruption in Central Banks is nothing new. It has happened in our Central Bank and in other Central Banks.

Experts and Scholars are on record that “corruption flourishes where agents have monopoly power plus discretion and where accountability is weak”

Our Central Bank has had the malaise for nearly a decade. It began with President Mahinda Rajapaksa appointing his own Governor. The aberration was made a tradition by Prime Minister Wickremesinghe who filled the position with his own nominee. The hands on and go getter Prime Minister has got his hands dirty in the first hundred days.

RanilThe recent bond deal involves the Bank of Ceylon – the nation’s premier state owned bank. In lightning speed, the Bank of Ceylon, headed by a senior Lawyer and UNP working committee member seems to have approved a credit line of Rs. 3 billion to the Primary Dealer whose bid was accepted by the Central Bank’s Treasury Bond Tender Committee.

Unless the new Governor had changed the composition of the Tender Committee its member ship includes several high ranking officials in addition to the Deputy Governor and the Additional Superintendent of Public debt. They are the Director of Economic Research, the Assistant Governor in charge of Public Debt, Director of Domestic Operations and the Superintendent of Public Debt as the Secretary of the Tender Committee. Transparency and Good Governance commenced with the swearing in of President Maithripala Sirisena on 9th January at Independence square.

Why did the Bank of Ceylon adopt the highly unusual practice of submitting a bid for a primary dealer? The primary dealer is supposed to submit bids on its own.

When truth is buried underground it grows, it chokes, it gathers such as explosive force that on the day it bursts out it blows up everything with it.

Before recommending others to read or watch ‘Citizen Kane’ the Prime Minister should read Emile Zola.

This undoubtedly is a scandal of epic proportions. The tender committee minutes have been leaked to media. It is a healthy sign of the presence of conscientious whistle blowers within the monetary authority.

The pompous posturing and capricious complaints by the Prime Minister Ranil Wickremesinghe in Parliament on Monday had a laser sharp focus and one primary purpose. He wanted to insulate the UNP working committee member Ronald Perera PC and Chairman of Bank of Ceylon from the radiation of the scandal.

The contrived credentials of the three mediocre lawyers appointed to report on the matter fail to hide the pivotal reason for their selection – their party allegiance and pliability.

Claiming to provide the background to the events, the Prime Minister studiously avoided any reference to the glaringly obvious link between the Primary Dealer and Bank of Ceylon. Free with names of people he wished to target he avoided the Bank of Ceylon, Perpetual Treasuries and their respective senior decision makers. He failed to mention that UNP chairman Malik Samarawickrema had also been present when the three member probe committee was appointed, a point publicly made by UPFA parliamentarians. Cavalier in naming bankers and brokers in high finance he was meticulously meagre with the details of the Bank of Ceylon link to the successful bid now under the spotlight.

The Prime Minister who claimed that he was not deaf, dumb or blind to the facts did not explain that the transaction included the Perpetual Treasuries bid of 2 billion directly and 3 billion through the Bank of Ceylon. This vital fact was not on his radar when he delivered his homily on bond trading in Parliament.

The primary dealer is supposed to submit bids on its own. That it was done in collaboration with the country’s premier state owned bank is unusual and inexplicable.

In this instance what has happened is that the primary dealer may not have had the funds to support its bid. Therefore the primary dealer had a credit line arranged with the Bank of Ceylon for Rs. 3 Billion.

This is not a privilege available to the ‘Maha Janaya’ whom the Prime Minster assured were his masters. The question arises weather the three lawyers of impeccable integrity will investigate whether the Bank of Ceylon conducted a credit appraisal before it approved the credit line for Perpetual Treasuries the primary dealer.

That may involve the three lawyers interviewing the Chairman of the Bank who should have been on the loop for a transaction of this magnitude. Now come the most interesting part. The bids have to be paid by the successful primary dealer immediately. The credit line from the Bank of Ceylon should have been approved in less than five minutes! Now that is ‘Avant-garde’ banking for you.

Up to the year 1970 Governance was a mixture of both good and bad. It was rarely ugly. The following episode has great relevance to the present day.

Parliament was debating a no confidence motion brought against Mr.M.H.Mohamed who was the Minister of Labour. Prime Minister Dudley Senanayake who wouldn’t or couldn’t say boo to a goose or utter a falsehood with a straight face defended his Minister. With characteristic candour he declared that he would give his Minister the benefit of the doubt. Dr. Colvin R De Silva who followed told Mr. Mohamed reassured the besieged Minister Mohamed. He did not expect him to resign. ‘In this country Ministers do not resign. Instead they resign themselves to the new situation! The episode has a moral in resolving the muddied muddle of Bonds. The dollar stops at the door step of the Prime Minister.

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Latest comments

  • 6
    1

    Unscrupulous UNP political turncoats flocked to Mara and 40 thieves in the former regime to fill their purses.

    Now half the thieves came with Maitri. Maitri himself was in the thick of the thieves’ den, though so far nobody says that he is one of ‘them’.

    Nobody accuses Ranil of being a thief (Remember Mahinda said that Ranil can be satisfied with a cup of tea?), but he has a dilemma to be either loyal to his colleagues or to good governance:

    Most likely, he chose the former.

    Truth is a bad word for politicians, isn’t it? The crux of the war crimes investigation is about the truth, which both the UNP and the SLFP deny that war crimes ever happened, and the UN wants to find the truth. So truth is not really a friend of the UNP or the SLFP: They will both deny that Tamils were ever oppressed to the extent of genocide.

    So we go down the slippery slope again: So long as one is surrounded by thieves how can you stop stealing taking place?

    Classical Greek paradox: If a barber living in an island shaves all those who don’t shave themselves, who shaves the barber?

    Figure that one out!

  • 2
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    In the enamored state we feel for President Sirisena and the Nation, Long live you Sir, we are reminded we must stand on guard, for us.

    Not passing the smell test on the Bond Issue and the subsequent handling of the fallout tells us, process followed is much less to be desired. Process bulldozed by people with power.

    From the Behavioral Sciences we learn, that we all cheat, just a little and sometimes big. Most of us are thieves by profession, yet given the situation will enrich ourselves, through white lies or pocketing the cash. The ” Power of the Situation ” as it’s known. Ask the Bankers on the Dock for ringing in the Global Economic Collapse we are struggling to get out from. And then our own Darling Arjuna Ranatunga in defense of his brother Nishantha, who still is the CEO of our Dear Sport, Cricket.

    We must ensure process is followed or build in processes to prevent anyone being put into situations where they will be ” nudged ” to act in a manner that is detrimental to Citizens Interests.

    Remember us people pay the price for their indiscretion, you and me included.

    We must stand on guard, for us.

  • 2
    1

    There have been so many corrupt deals of the Rajapakses principally after 2009 when the LTTE was defeated. The Rajapakses assumed that since they had ended the war,the people of this country should give them an open visa to continue to govern indefinitely and to permit them for unjust enrichment!

    The author of this essay was nowhere to be seen then.He is now taking up the position of a Holier than Holy stand!

  • 4
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    We have no doubts about the intergrity of P.M, Ranil Wickremasinghe but in the case of the Central Bank Bond Issue, he should not hesitate to act without any fear or favour. He must understand his own intergrity and reputation is at stake. He should not try to cover up any of his close associates if they are suspects.

    In this particular case, the Bank of Ceylon whose head was appointed by the UNP, and incidentally a Senior Lawyer, the three member panel appointed are also lawyers associated with the UNP, Arjuna Mahendran, the CB governor, who is suppose to be closer to the RW, and his Son in Law, Alloysius, one of the primary dealers, whom we understand resides at the same residence as the CB governor.

    All these connections does not speak as truth will be released to the public but with time would be swept under the carpet.

    At the Presidential elections in January 2015, most of us UNP supporters, voted in favour of the
    common candidate proposed by the UNP/RW with the hope and great expectation that good
    governance would at last be established which is now becoming a day dream. It is very essential
    that Ranil W has to dispel these thoughts, urgently, by taking proper action to appoint more independent public personalities to probe the whole episode if he is to expect the support of the masses at the next elections which could probably be in the next few months.

  • 1
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    The author and a few commentators are sadly RIGHT.
    The Deputy Minister is stupid to make these comments.

    http://ceylontoday.lk/51-87802-news-detail-cb-bond-issued-to-pay-debts-of-former-govt-harsha.html

    It is an embarrassingly a sad situation.
    The Sunday Newspapers will have more news and details.

    There is now news where the Governor is now? Sri Lanka, Singapore, USA, or Dubai.
    or even rumored in Vietnam with Basil. Who knows. Why is all this secrecy? After all isn’t he a public servant of Sri Lanka?

    This is also bad for the Minister in Charge Harsha De Silva and the Prime Minister Ranil De Silva. They are all wasting a lot of their time defending this appointment, this CB Bond Auction, now the leave of absence or continuing working despite the statements, the work permit issued by the immigration as now claimed in Parliament.

    How ever only this Monday Mr Harsha De Silva gave a contradictory Video interview and the dream job he wants for himself.

    Now the Bank of Ceylon, It’s Chairman Ronald Perera, his law office/attorneys, his Minister Ravi Karunananayake, UNP Chairman Malick Samarawickrema and very unfairly dragging my friend Raj Rajaratnam (US citizen like me, lol) into this damn scandal. It is hurting this government and the UNP if they all want us to believe that Parliament will be dissolved after the new MP’s like …………… complete there 5 year term qualifying for their pensions for life on April 23.

    The 100 days will complete 28 days.. What good governance is this?
    Wake up and smell the coffee, and tell those donkeys like Suresh that I won;t be falling off my chair like the parasites. (MalaPereythayas).

    Donald Jayantha Gnanakone
    Tamils For Justice
    Founder.

  • 0
    0

    Oh, my comments on the holier than thou , Donald, seems to be crawling under his blemished skin.
    If I m the donkey, sorry Donald you re my ass!
    Cut the crap, & don’t make comments on subjects that are well over your grasp.
    Just keep working as the Founder for Tamils for Justice.
    Whatever it does, you probably know best.
    Whatever money your charity gets must be starting off in your personal pocket, since I believe your scrapping the bottom of the barrel. Why don’t you tell us, what your charity does from Los Angeles for the Tamils in Sri Lanka.
    I do more, without a tag, just by the fact that I live in Sri Lanka & am well aware of the ground situation, unlike you, from the cushy comforts of Sunny California.
    If MR were in power, you would’ve been in Welikade jail, & no, MR would not have visited you there.
    Or maybe, pity you were not taken off in a white van.
    Long live Donald & his sarcasm.

  • 0
    0

    The Tamil disgrace continues on Sunday morning where the headlines are about Mahedrans, Aloycious, Central Bank for the wrong reasons. Mahendran is hurting Ranil very badly and being his good friend he should RESIGN.

    Mahendran has scarred his family name on both sides and Aloycious too has scarred his family name and the Mahendran family because of his greed and arrogance.

    Read this Suresh. I will respond to your personal attacks on behalf of Mahendran and the Nadesan/Maharajah families. Hold tight and your thick head and skin. That is Kabaragoya skin. I am blessed with beautiful skin and good looks from a small age. I am also not a FAT PIG like others. Ask them to weigh themselves again and take another look in the mirror.

    By the way, I weigh only 169 pounds and 6 feet 1″” tall.

    They should eat less and exercise without sleeping around the whole damn day. Being lazy does not help their mental and physical help. I would explain more later for the benefit of the readers.

    https://www.colombotelegraph.com/index.php/ranil-rants-raves-knots-himself-up/

    http://ceylontoday.lk/51-87802-news-detail-cb-bond-issued-to-pay-debts-of-former-govt-harsha.html

    http://www.sundaytimes.lk/150322/news/bond-issue-probe-committee-to-question-dealers-on-inside-info-141249.html

    Suresh Murugesar there is plenty of skeletons in your cupboard and it will fall one by one. You will fall from your chair and bed. So will the readers.

    Donald Gnanakone
    Tamils For Justice.
    Founder.

  • 0
    0

    Well done Mr. Sarath de Alwis. After a decade of governance by a group of thieving rascals who robbed us left, right and centre the people in this country are entitled to a clean, honest and transparent government. We need to regain our lost reputation in the global financial markets. We need educated, experienced and able men-women of the free press to keep the flame of democracy burning – by keeping the Govt of the day in constant check. I am sure M/s. Maitripala S and Ranil W will not object to this – on the basis of their current pontification.

    I also raised the question of how Arjun Aloysius of Perpetual manage to raise such a huge sum in one deal alone as Rs.2 billion – super fast. What was the collateral offered. Did he provide collateral for his earlier mega deals? Or is he a contributor to the several billions of rupees BoC is unable to get back? Or, worse, is he some kind of a shill for larger sharks in the last administration?

    Backlash

  • 0
    0

    This is the current Central Bank and Governor’s problem….

    Columns =courtest Cafe Spectator.
    Startling disclosures: Two former VIPs have US$ 1 billion in Dubai bank

    The bank details of two powerful personalities in the former regime have been handed over by the Government to the Stolen Assets Recovery Initiative (StAR) of the World Bank and the UN Office on Drugs and Crime. One of them with strong family connections is known to have held US$ 530 million whilst the other, a fixer of all sorts and now in the news, held US$ 516 million. Both have had accounts in a leading Bank in Dubai.

    According to ‘credible reports’ reaching the Government, the bank in question has classed the two accounts as having “restricted access” and is under the charge of an Egyptian national, who is manager of the Division. The funds have been deposited in the two accounts during the reign of the previous Mahinda Rajapaksa administration. The Government suspects that these funds have been obtained through corrupt means, commissions from large projects and “donations” from foreign concerns. It is also said to include a “gift” made by an Arab leader who was deposed and died tragically.

    It was only last Wednesday that the Cabinet of Ministers decided to appoint a Special Presidential Task Force to identify unlawfully acquired overseas assets of Sri Lankans. How details of these accounts where deposits have been made periodically were obtained is not immediately available. However, Foreign Minister Mangala Samaraweera is learnt to have officially discussed means of tracking ill-gotten gains stacked overseas by leaders of the previous Government when he visited the United States last month. This was during talks with senior US dignitaries.

    The StAR is a partnership between the World Bank Group and the United Nations Office on Drugs and Crime (UNIDOC) that supports international efforts to end safe havens for corrupt funds. It works with developing countries and financial centres to prevent the laundering of the proceeds of corruption and to facilitate more systematic and timely return of stolen assets.

    Royal jokes reign supreme
    Rain battered the SSC grounds during the recent Royal-Thomian annual cricket encounter with the Mount Lavinia boys sitting pretty.
    But with so many playing hours lost due to rain on the second and third days the old boys at the Mustangs turned to their usual form of sustenance. As the scotch and the vodka went down, up came the jokes and the banter was mostly at the expense of Royal College.
    When play stopped on the second day and the rains cleared, the umpires would still not go out. So one former Thomian cricketer was heard asking a colleague what was delaying play.

    “The umpires are waiting for the report,” he said
    “What report?” asked the former.
    “Why didn’t you hear? Ranil has appointed a three-member committee to report on the weather.”
    “Are they all Royalists?” another Thomian was heard to ask loudly and those nearby burst into laughter.
    On the third day when no further play was possible and the old boys found solace in Johnny and Walker, an old Thomian was heard to say that today nobody could get a place on a government appointed board or corporation unless they had an FRCS. What have surgeons got to do with it, asked an old Royalist. Not a medical qualification you idiot, said the first. It stands for Former Royal College Students.

    Finance Minister Ravi Karunanayake, an old Royalist who probably overheard the crack seemed to blush if such a thing is possible for him.
    Royalists however, conceding they were on a ‘tricky wicket’ as far as the match went, say that the rains arrive on time when the leaders rule justly. So with the country’s two leaders, one an FRCS (Polonnaruwa) and the other an FRCS (Colombo), the rains arrived just in time – for a draw – and the Royalists to retain the D.S. Senanayake challenge shield they won in 2011.

    This year’s match was featured in two prestigious US newspapers — The New York Times and the Wall Street Journal. One of them referred to PM Wickremesinghe having a tough choice’ greeting visiting Indian PM Narendra Modi or going for the Royal-Thomian. So, he gave Modi a lunch on Friday and went for the match on Saturday, said one of the newspapers.

    BANKERS IN DUBAI ARE USED TO MONEY LAUNDERING AND UNETHICAL PRACTICES. BUT THEY DO NOT LAST LONG. SOME WERE MONEY LAUNDERING FOR THEIR FRIENDS IN THE FORMER REGIME. SOME UNP’ERS PLAYED BOTH SIDES. AC/DC. THAT IS SURESH’S EXPERTISE AND LIKES ASS AND TALKS ABOUT IT ALL THE TIME.

    Donald Gnanakone
    Tamils For Justice

  • 0
    0

    Finance Minister Ravi Karunanayake told Parliament yesterday (21) that the Government is ready to work on a national government along with the opposition, but they would never protect wrongdoers on both sides.

    ( THIS WAS QUOTED FROM ANOTHER LEADING NEWWSPAPER IN SRI LANKA )

    MR RAVI K ARE YOU TRYING TO HIDE WITHIN THE NATIONAL GOVT TOO ?
    YOU WILL BE CHARGED ALSO FOR YOUR CONNECTIONS WITH MR RAJ RAJARATNAM ?

    ADVICE TO ALL THE POLITICIANS IN SRI LANKA . NO MATTER WHAT YOUR RELIGIOUS BELIEFS ARE ……….. NO HUMAN BEING CAN FOOL GOD . THE TRUTH WILL COME OUT AT THE END . MR MS AND MR RW YOU BOTH HAVE LIED TO THE INNOCENT PEOPLE OF SRI LANKA AND YOU BOTH WILL PAY A HUGE PRICE DURING THE NEXT ELECTION .

    . THE PEOPLE OF SRI LANKA ARE VERY SMART AND MOST OF US CAN SEE THE TRUTH . AND THE POLITICIANS THINK THAT OUR PEOPLE ARE STUPID ? THEY ARE NOT ….PLEASE DO NOT BE SURPRISED IF THE JPV INCREACES THEIR STAKE IN SL POLITICS . MAY GOD BLESS OUR COUNTRY ………..

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