Colombo Telegraph

RTI Commission Orders People’s Bank To Disclose Money Spent To Defend Digitization Scam!

Sri Lanka’s Right to Information Commission has directed the People’s Bank to disclose the total amount of legal fees paid by the Bank to retain private lawyers to defend a legal action against members of the Ceylon Bank Employees Trade Union who had protested against a massive digitization scam by the Bank’s management.

People’s Bank Chairman -Hemasiri Fernando

The Union’s request has been upheld by the Commission on the basis that the Public Authority is effectively utilizing public funds in regard to which transparency and accountability of the highest standard must be reflected and that public interest is reflected in regard to the decision. 

Rejecting the argument of the Bank that professional privilege and fiduciary concerns will block the giving of that information, the Commission’s Order has based its decision on international and regional legal principles discussed in detail. It  has pointed out that, as the Bank’s Annual Report anyway discloses the total value of litigation engaged in by the PA, there need not be secrecy in respect of the information asked for.  

The RTI Commission has commented sharply on the fact that the Designate Officer of the Bank had not responded on the appeal by the Union filed under Section 31 of the Act and has said that this cannot be excused on the ground of mere advertence. The Commission has stated that this amounts to bypassing a statutory duty on the part of the DO as detailed in Sections 31 (2) and (3) of the Act. 

Its Order states that ‘it is unfortunate that a state banking institution such as the PA, as named in this appeal, has treated mandatory duties imposed by legislation in such an indifferent manner. This stands in sharp contrast to the manner in which other PAs, including key banking institutions, have carried out their obligations in terms of the Act.’ 

A public outcry was created in recent months by disclosures of major financial irregularities at the Peoples Bank. The Committee on Public Enterprises (COPE) had ordered details to be given of massive expenditure incurred on a digitization project of the Bank including expenses payments totaling Rs 84 Million. COPE had also criticized the fact that the top management of the Bank had been operating on contract basis for close to fifteen years with perks and benefits.

Media reports said that out of the loans issued by the Bank totaling Rs 38,000 million in 2017, a large percentage had been non-performing. The Bank was also pulled up by COPE for paying Rs 75 million as salary increments arrears to General Manager, N. Vasantha Kumara and a former Senior Deputy General Manager and had refused to authorize the extension of the General Manager.

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