By Chandra Jayaratne –
The Public Interest Information re Controversial Penthouse will be answered by the relevant parties by responding to the undernoted questions:
1. Details of the respective Lessees, Tenants and Owners of the property, during the period January 2015 to June 2017, along with any relevant changes and effective dates of change?
2. If a Company was the Lessee, Tenant or Owner of the property during this time,
a) Whether a private or public company?
b) the names of shareholders and directors of the company, along with their respective levels of shareholding interests and dates of change?, and
c) the primary business activity of the entity?
3. If any shareholder or director of the entity was a non resident, confirmation that the relevant and applicable statutory and regulatory compliance processes had been duly adopted in the allotment of shares and the appointment as directors?.
4. If any of the individual or companies, who were Lessees, Tenants and Owners of the property were deemed to comprise of any Politically Exposed Persons or persons closely related to such persons, were the required reviews and approvals processes complied with by the professionals, lawyers, bankers etc, involved ;
a) When opening banking relationships?
b) in the subsequent processing of financial transactions or contracting ?
c) in the assessment of requests for loans or credit facilities from Banks?
d) grant of loans and credit facilities by Banks,
in line with the Financial Action Task Force Guidelines covering Politically Exposed persons?
5. When the persons or entity in question took steps to settle significantly high value loan repayments in cash, did the relevant Banks in question take steps to raise Suspicious Transactions Reports in compliance with the directions issued by the Financial Investigations Unit?
6. From which sources did the non-resident director/chairman access the significantly large cash holdings to be deposited in the safe of the business entity? Were these from existing holdings in local banks? If so did such bank validate the reasons for the draw-down of such cash in currency notes? and did they raise suspicious transaction reports? Or were these currency notes secured by way of inward remittances en-cashed locally or did he bring over currency notes from overseas? and If so did such bank validate the reasons for the draw-down of such cash in currency and raise suspicious transaction reports? What denomination were the notes in and were they all new Rs. 5000/= currency notes?
7. If Suspicious Transaction Reports were raised in the instances 5 and 6 above, what action was taken by the Financial Investigations Unit?
8. Have the banks in question, which received such significant cash payments a record of the currency note serial numbers and did they validate the said numbers with the declared source of notes?
9. How did the Accountants and the Auditors of the entities engaged, account for and treat the cash payments made by third parties as lease rentals, cash holdings and cash payments in loan settlements, in preparing the Accounting statements of the entities, especially
a) the cash receipts and cash deposits in banks and cash payments to the lessors of the property?
b) the Cash receipts kept in the safe?
c) The Cash payments made to lenders as repayment of loans, using the cash in the safe?
d) Did they by way of any notes to the accounts disclose in these instances, any consequential conflicts of interests and any related party transactions?
e) Were the cash in safe under insurance cover and were the extents of holding declared to Insurers were these declarations seen by Accountants and auditors?
f) Were these transactions including third party lease rent payments queried by the internal or external auditors of the entities concerned?
g) Did the formal minutes of the entities, including those making unrelated third party payments note these transactions?
h) Were there any references in the Management letters of the auditors to any of the above entities regards these transactions
i) Were the Accounts qualified or these transactions subject to highlight by the auditors?
10. How were these transactions accounted for in Tax Accounts and Tax returns of the entities and individuals concerned? The apartment having been used by directors of the entity, was any Payee or other taxation payments made on account of non cash benefits of the said directors, in their occupation of a leased property at first and an owned property subsequently?
11. Had the revised Code of Ethics of the Institute of Chartered Accountants of Sri Lanka, now in force been applicable then, would professional Accountants involved in these entities in any capacity, including as accountants and auditors, taken due steps in line with the said Code to have responded to these significant non compliance with laws and regulations (NOCLAR) ?
12. Had any member of the Bar Association involved in these transactions, complied with the Financial Action Task Force Guidelines and Financial Intelligence Unit gazette directions binding on legal professionals?