{"id":185607,"date":"2017-12-17T18:12:06","date_gmt":"2017-12-17T12:42:06","guid":{"rendered":"https:\/\/www.colombotelegraph.com\/?p=185607"},"modified":"2017-12-21T01:37:31","modified_gmt":"2017-12-20T20:07:31","slug":"bond-commission-report-moment-of-truth-for-country","status":"publish","type":"post","link":"https:\/\/www.colombotelegraph.com\/index.php\/bond-commission-report-moment-of-truth-for-country\/","title":{"rendered":"Bond Commission Report: Moment Of Truth For Country"},"content":{"rendered":"<p class=\"p2\"><b> <\/b><span class=\"s1\"><b>By\u00a0<\/b><\/span><span class=\"s1\"><b><a href=\"https:\/\/www.colombotelegraph.com\/?s=Amrit+Muttukumaru\">Amrit Muttukumaru<\/a> &#8211;<\/b><\/span><\/p>\n<div id=\"attachment_142887\" style=\"width: 154px\" class=\"wp-caption alignright\"><a href=\"https:\/\/www.colombotelegraph.com\/wp-content\/uploads\/2015\/04\/Amrit-Muttukumaru.jpg\"><img loading=\"lazy\" decoding=\"async\" aria-describedby=\"caption-attachment-142887\" class=\"size-thumbnail wp-image-142887\" src=\"https:\/\/www.colombotelegraph.com\/wp-content\/uploads\/2015\/04\/Amrit-Muttukumaru-144x150.jpg\" alt=\"\" width=\"144\" height=\"150\" \/><\/a><p id=\"caption-attachment-142887\" class=\"wp-caption-text\">Amrit Muttukumaru<\/p><\/div>\n<p class=\"p4\"><span class=\"s1\">The country is awaiting with a mix of excitement and trepidation the Report of the Presidential Commission of Inquiry (PCoI) into the alleged Treasury <a href=\"https:\/\/www.colombotelegraph.com\/?s=Bond+Scam\">Bond Scam<\/a> which will one way or another indicate whether there is hope for optimism for the future of the country. The report is crucial for reasons which include:<\/span><\/p>\n<p class=\"p4\"><span class=\"s1\">1) It has captured the popular imagination unlike no other scam in a country awash with scams under successive administrations since television in vivid colour and social media enhanced by good investigative reporting in the print media have brought its sordid details to even the humblest of homes. The people have drawn their own conclusion and if they sense there has been a \u2018cover-up\u2019 particularly of its masterminds it would further undermine the \u2018rule of law\u2019 which is a sine qua non for any meaningful socio-economic development.<\/span><\/p>\n<p class=\"p4\"><span class=\"s1\">2) Those who voted for the \u2018Yahapalanaya\u2019 government under trying circumstances to usher in<span class=\"Apple-converted-space\">\u00a0 <\/span>\u2018good governance\u2019 after the traumatic Rajapaksa years feel betrayed and demand accountability.\u00a0<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">3) That Sri Lanka is an unreliable and unstable country where the \u2018rule of law\u2019 is not applied uniformly is well known to the outside world. Equally well known is its endemic corruption, social injustice and inability to address long festering minority issues. It is due to this that ethical FDIs are few and far between. In its place we have had some questionable proposals with alleged money laundering origin. The controversial Chinese and Indian investments are largely driven by geo-political consideration with the potential to destabilize the country. Any \u2018cover-up\u2019 will confirm the worst fears of the international community.<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">4) After nearly 70 years of independence the country has come to such a sorry pass that we have to suffer the ignominy of: <\/span><\/p>\n<p class=\"p6\"><span class=\"s1\">\u201cThe US State Department\u201d reportedly fielding \u201ca Resident Legal Advisor in Colombo to provide anti-corruption and asset recovery training and also support the Commission to Investigate Allegations of Bribery and Corruption (CIABOC)\u201d<\/span><\/p>\n<p class=\"p6\"><span class=\"s1\">Does this not indicate we are near to being a \u2018failed state&#8217;\u2019? <\/span><\/p>\n<p class=\"p6\"><span class=\"s1\">In this context if the Report of the PCoI is not credible, will it not confirm this with all its implications?\u00a0<\/span><\/p>\n<p class=\"p6\"><span class=\"s1\">Have not some PCoI actions during the inquiry stage raised fears of what\u2019s to come?<\/span><span class=\"s4\">\u00a0<\/span><\/p>\n<p class=\"p6\"><span class=\"s2\"><b>Partiality<\/b><\/span><span class=\"s1\"><b>?<\/b><\/span><\/p>\n<p class=\"p6\"><span class=\"s1\">Readers can decide for themselves whether or not the PCoI abandoned \u2018DUE PROCESS\u2019 for other witnesses by glaring PARTIALITY to one witness?<\/span><\/p>\n<p class=\"p5\"><span class=\"s2\">Core of Bond Scam:<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">1) \u2018Conflict of interest\u2019 arising from then Central Bank Governor Arjuna Mahendran\u2019s son-in-law, Arjun Aloysius &#8211; owning\/controlling PTL (Perpetual Treasuries Limited) &#8211; a Primary Dealer. <\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">2) Arjuna Mahendran &#8211; a foreign national being handpicked for the position of Governor, CBSL by the Prime Minister although aware of the \u2018Conflict of interest\u2019. The PM himself confirmed this in his affidavit and while testifying before the PCoI.<\/span><\/p>\n<p class=\"p8\"><span class=\"s1\">3) The Central Bank of Sri Lanka (CBSL) the issuing agency for Treasury Bonds which normally falls under the Ministry of Finance being brought under the purview of the Prime Minister.<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">4) The PM continued to have Mahendran as CBSL Governor although he was aware that Mahendran had reneged on his \u2018assurance\u2019 to him that his son-in-law (Arjun Aloysius) will sever all links with PTL prior to his appointment as CBSL Governor.<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">5) The PM robustly defended and endorsed Mahendran for a second term despite the widespread perception of Mahendran\u2019s role in the alleged Bond Scam.<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">6) Being<i> <\/i>fully confident on the propriety of the issuance of Bonds, the PM robustly defended the same in Parliament despite the evidence that subsequently transpired before the PCoI.<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">7) During his testimony at the Bond Commission the PM stated: \u201cMr. Aloysius did say to me he need bit of time to dispose his share holding to get good price. (shares of Perpetual Treasuries Ltd or shares he held in other entity in the name of PTL). I met him (Aloysius) at one or two parties, and there he told me that he was pursuing his interests in Mendis distilleries.\u201d<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">What is at issue is the integrity of the Central Bank of Sri Lanka. How can the PM who is also responsible for the CBSL even consider a \u201cbit of time\u201d to resolve a \u2018conflict of interest\u2019 concerning the Governor and that too articulated \u201cat one or two parties\u201d?<\/span><\/p>\n<p class=\"p5\"><span class=\"s2\">Despite all this, did not the PCoI take some unusual decisions in regard to one witness<\/span><span class=\"s1\">?<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">1) Unlike in the case of other witnesses, the PM was given questions in advance by the PCoI to enable him to provide answers by way of affidavit.<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">2) Unlike in the case of other witnesses, the PCoI decided to invite the AG himself who wasn\u2019t involved in the investigation up to that point to personally lead evidence for the first time.\u00a0Up to this time, Messrs. Dappula de Livera and Yasantha Kodagoda &#8211; Senior Additional Solicitor General and Additional Solicitor General respectively lead evidence.<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">3) Unlike in the case of other witnesses which included former Finance Minister Ravi Karunanayake who were grilled by Messrs. Dappula de Livera and Yasantha Kodagoda, limited questions were posed to the PM. The PM was at the PCoI reportedly for less than an hour to clarify matters arising from his affidavit<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">4) Much is being made that the PM \u2018volunteered&#8217; to come before the PCoI although \u2018not summoned\u2019 like the other witnesses. The media has even reported that PCoI Chairman \u2013 K. T. Chitrasiri (SC Judge)<span class=\"Apple-converted-space\">\u00a0<\/span>\u201cemphasised that the question of compelling PM Wickremesinghe to appear before the commission had never arisen\u201d.<span class=\"Apple-converted-space\">\u00a0 <\/span>I respectfully ask (i) in view of the facts and circumstances should not the PM have been \u2018summoned\u2019 like the other witnesses? (ii) if not why? (iii) what does this indicate?<\/span><\/p>\n<p class=\"p5\"><span class=\"s2\"><b>PM Contradicted<\/b><\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">For reasons best known to the PCoI it did not pursue the PM\u2019s affirmation in his affidavit \u201cUpon the formation of the new Government in January 2015 there was a general consensus within the Government that Mr Mahendran should be appointed to the post of Governor of CBSL.\u201d <\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">Did the \u201cgeneral consensus\u201d include HE the President and Cabinet Ministers? \u00a0<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">No less a person than Cabinet Co-Spokesperson and Minister of Health\u00a0Dr. Rajitha Senaratne has <a href=\"http:\/\/www.island.lk\/index.php?page_cat=article-details&amp;page=article-details&amp;code_title=176272\">contradicted<\/a> the PM\u2019s claim of \u201cgeneral consensus\u201d: <\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">\u201cSenaratne said he had opposed the appointment of former Central Bank Governor Arjuna Mahendran to the position at the time.&#8221;I warned that it would tarnish the government\u2019s image,&#8221; the minister said.\u201d<\/span><\/p>\n<p class=\"p5\"><span class=\"s2\"><b>\u2018Breakfast\u2019 Meeting<\/b><\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">Malik Samarawickrama who did not hold ministerial portfolio at that time and who was Senior Advisor to the PM and Chairman of the UNP confirmed attending the initial \u2018Breakfast\u2019 meeting in February 2015 (presumably with the concurrence of the PM) on the issuance of Treasury Bonds. The PM is UNP leader. <\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">It is disappointing that the AG\u2019s Department had no questions to ask Ministers Malik Samarawickrama and Kabir Hashim (UNP General Secretary) when they appeared before the PCoI and did not seek to clarify whether a discussion regarding funding to the tune of Rs. 15 Billion could be concluded over a \u2018breakfast\u2019 meeting. One wonders what the funding requirements must be to have a formal meeting! No questions were also asked as to how an \u2018advisor\u2019 can request funding.<\/span><\/p>\n<p class=\"p5\"><span class=\"s2\"><b>Muted Opposition Response<\/b><\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">The alleged Treasury Bond scam is one of the largest financial scams to take place in the post-independence history of Sri Lanka. For sheer impunity and involvement of powerful politicians in collusion with a section of the corporate sector and regulatory authorities it is hard to beat. The muted response of the opposition exemplifies the rot in governance in this country. In the context of the alleged money laundering charges against the previous regime, whether the muted response has anything to do with former Central Bank Governor, Arjuna Mahendran\u2019s stint as Chief Investment Officer, Wealth Management Division of Emirates NBD Bank, Dubai would be revealing.<\/span><\/p>\n<p class=\"p10\"><span class=\"s2\"><b>Money Laundering<\/b><\/span><span class=\"s1\"><b>?<\/b><\/span><\/p>\n<p class=\"p5\"><span class=\"s6\">I trust the PCoI in its report will at least recommend that <\/span><span class=\"s1\">crucial issues of governance incidental to the alleged bond scam thrown up by witnesses at the Bond Commission such as possible (i) Tax Evasion (ii) Money Laundering (iii) Bank Malpractice (iv) Politically Exposed Persons (PEPs) being appointed as directors of banks must be transparently addressed by regulatory agencies such as the CBSL and Inland Revenue Department.<span class=\"Apple-converted-space\">\u00a0 \u00a0<\/span><\/span><\/p>\n<p class=\"p11\"><span class=\"s1\">To date these agencies do not appear to have demonstrated any interest in addressing these issues. I trust Dr.\u00a0Indrajit Coomaraswamy &#8211; CBSL Governor and others will take note.<\/span><\/p>\n<p class=\"p5\"><span class=\"s2\"><b>Conclusion<\/b><\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">Things are so bad in Sri Lanka that the rule of law was selectively applied not to compel Arjun Aloysius \u2013 owner of PTL to give evidence before the Bond Commission on the basis it would incriminate him since apparently in his own mind there was a high probability he would be prosecuted. The same rule of law was MUTE in taking the next steps that could have been taken independent of the report of the Bond Commission in the context of the damning evidence produced at the PCoI. It also indicates that the relevant regulatory and law enforcement agencies are largely on sleep mode. This tardiness in taking necessary legal action has resulted in a situation where as disclosed by the Prime Minister during his testimony at the Bond Commission, Aloysius was even able to be present \u201cat one or two parties\u201d where he was in a position to converse with the PM himself!<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">As I see it, the alleged Bond Scam had the masterminds and the facilitators. I trust those concerned will not miss the wood for the trees! Of course, the \u2018facilitators\u2019 too must be held accountable.\u00a0<\/span><\/p>\n<p class=\"p5\"><span class=\"s1\">What we have still not convincingly seen is the quantifying of the looted monies which must be returned to the exchequer. It is hoped that particularly PCoI Commissioner &#8211; K.Velupillai (former Deputy Auditor General) will address this in the report.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p> [&hellip;]<\/p>\n","protected":false},"author":163,"featured_media":142887,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,46,8],"tags":[],"class_list":["post-185607","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-colombotelegraph","category-constitutional-reforms","category-editorial"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Bond Commission Report: Moment Of Truth For Country - Colombo Telegraph<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.colombotelegraph.com\/index.php\/bond-commission-report-moment-of-truth-for-country\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Bond Commission Report: Moment Of Truth For Country - 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