AG directs IGP to arrest Ravi, Mahendran, Aloysius

4 March 2020 12:10 am - 0     - {{hitsCtrl.values.hits}}

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  • AG considers sufficient evidence to charge
  • Charges over two Bond auctions, where former Minister asked three state banks to bid low

 

By Shehan Chamika Silva   

Attorney General Dappula de Livera has decided that there is sufficient evidence to conclude on ‘reasonable suspicion’ that former Finance Minister Ravi Karunanayake, Arjuna Mahendran, Arjun Aloysius and nine others have acted against the law during two Treasury Bond auctions conducted on March 29, and March 31, 2016.   

The AG has also instructed to obtain arrest warrants against the suspects over committing offences under the Public Property Act, Penal Code and the Registered Stock and Securities Ordinance.  On March 29, 2016 and March 31, 2016, the Central Bank of Sri Lanka had held two bond auctions to raise funds to the Government. The advertised amount at the March 29, 2016 auction was Rs. 40 billion and it had ultimately accepted Rs. 76 billion. The advertised amount of the March 31, 2016 auction was Rs. 25 billion and the accepted amount was Rs. 50 billion.   


In 2017, at the Bond Commission (PCOI) it was revealed during startling evidence by eight witnesses from the three state banks (BoC, NSB and People’s Bank), that former Finance Minister Ravi Karunanayake had asked state banks to bid at lower rates at two bond auctions assuring them that other bids at higher rates would not be accepted.   

 

They were to be arrested on charges of conspiracy, criminal  misappropriation, cheating, and market manipulation in connection with  the bond auctions in March 2016


However, on both occasions at those auctions the CBSL had accepted bids much more than the advertised amount and at much higher rates.   


During the Bond Commission, a phone Conversation was played, where Aloysius was instructing his CEO Palisena on how to bid at the March 29, 2016 auction referring to vital information he received from different sources. This conversation took place during mid-morning on the March 29 auction day.   Aloysius in the conversation says that there was a “state banks meeting” that had taken place closer to that day. According to what happened at that meeting, Aloysius tells Palisena the rates at which the state banks (NSB, BoC, and People’s Bank) would bid at the March 29, 2016 auction.   


The AG had considered levelling following specific charges against the suspects and also had instructed the AIGP to record statements from the suspects as per the Criminal Procedure Code.
· Perpetual Treasuries Ltd   
-Misappropriating (386), Conspiring (113) and abetting (102) under the Penal Code.   
-Misappropriating Rs. 36.98 billion face valued T-Bonds under the Public Property Act. (At the March 29, 2016 auction)   
-Misappropriating Rs. 15 billion face valued T-Bonds under the Public Property Act. (At the March 31, 2016 auction)   
- Breaching the primary dealers’ code of conduct by Insider Dealing and market manipulation under section 56a(1)a of the Registered Stock and Securities Ordinance   
· Ravi Karunanayake
-Conspiring and abetting to misappropriate Rs. 36.98 billion and Rs. 15 billion face valued T-Bonds under the Penal Code. (at the two auctions)   
-Cheating (398 Penal Code) three state banks namely BoC, NSB and People’s Bank at the auction.   
-Misappropriation under the Public Property Act   
· Arjuna Mahendran
-Conspiring and abetting to misappropriate Rs. 36.98 billion and Rs. 15 billion face valued T-Bonds under the Penal Code. (at the two auctions)   
-Misappropriation under the Public Property Act   
· Arjun Aloysius
-Conspiring and Aiding and abetting the first suspect (PTL) to misappropriate Rs. 36.98 billion and Rs. 15 billion face valued T-Bonds under the Public Property Act and the Penal Code (at the two auctions)   
-Breaching the primary dealers ‘code of conduct’ by Insider Dealing and market manipulation under section 56a(1)a of the Registered Stock and Securities Ordinance   
The AG had also levelled similar allegations against other suspects under the Public Property Act, Penal Code and the Registered Stock and Securities Ordinance.   
Other suspects are, Kasun Palisena (PTL CEO), Geoffrey Aloysius, C. Ranjan Hulugalla, Muththuraja Surendran, Ajan Punchihewa, T.H.Buddika Sarathchandra, S. Padumanapan (CBSL official) and B.H. Indika Saman Kumara (EPF Dealer).   

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