Trade based money laundering takes place despite intelligence from Central Bank

• “You don’t need new regulations but should see about the amendment which the cabinet had approved in 2019 and pursue it,”

By Yohan Perera and Ajith Siriwardana   

The Finance Intelligence Unit of the Central Bank has been giving actionable intelligence on trade based money laundering since 2024, but action has not been taken to thwart such attempts, Opposition MP Dr. Harsha de Silva said in Parliament yesterday.   

Dr.de Silva who chairs the Committee on Public Finance (CoPF) made this revelation in the wake of discovery that as much as US $ 715 million had been sent out of the country on false import documents.   

He stressed the need for proper enforcement of existing rules and regulations to prevent such financial crimes.   

Meanwhile, Deputy Minister of Finance Anil Jayantha said that new regulations will be introduced to rectify the matter. “The offenders can only be fined as per the existing laws. New regulations are needed to criminalise the offence and subject the offenders to a punishment accordingly.   

Dr. de Silva who responded said cabinet approval has been granted to amend the laws to criminalize illegal transfer of funds. “The approval had been given by the cabinet for the new regulation in 2019. 

 It had been then sent to the Legal draftsman for amendments. The Legal draftsman had failed to come out with the amendment for the last six years. You should inquire from the legal draftsman’s office on the matter,” the MP said.   

 “You don’t need new regulations but should see about the amendment which the cabinet had approved in 2019 and pursue it,” the MP added.   

MP de Silva who is the chairman of the Committee on Public Finance (COPF) said the committee he heads had looked into all these matters.   

“The issue today is that the government is looking towards introducing new regulations rather than enforcing existing regulations. The situation is the same when it comes to gaming and casinos. The actual matter with casinos is that a body has been set up to regulate them but there are no regulations. There are no teeth to bite although there is a mouth,” he said in this regard.   

He said the new regulations which are to be introduced by the present government will only affect the importers who abide with the law. The new regulations he said will make the importation more rigid as an importer will have to get his company registered thrice.   

Coming up with more disclosures he said the probes made by his committee had found that there are 500 companies engaged in importation without verified addresses and articles of association which are needed to register a company. Also he said some companies who are engaged in gaming including one which is engaged in betting are not paying taxes as it has been revealed by the Department of Inland Revenue.