Arrest if any senior NDB officials if found to have aided Rs. 13 billion fraud: Court told

By Bhagya Silva

Colombo, May 14 (Daily Mirror) - Colombo Chief Magistrate Asanga S. Bodaragama today observed that the Criminal Investigation Department should arrest and produce before the court if any senior officials of the National Development Bank (NDB) have aided and abetted the fraudulent misappropriation of Rs. 13 billion from the bank’s general ledger account.

The Magistrate also directed the CID to submit a detailed report to the court regarding the recommendations issued by the Central Bank of Sri Lanka after complaints were made regarding the fraud and if such recommendations had been made, to identify the senior bank officials who had suppressed them.

These orders were issued when the complaint filed by the Cyber Crimes Investigation Division of the CID regarding the alleged fraudulent withdrawal of Rs. 13 billion from the general ledger account of the National Development Bank between 2024 and March 2026 was taken up before the court.

When the matter was called, the suspects who were remanded in connection with the incident, Lahiru Kodikara of the Payment and Settlement Division under shared services, his alleged brother Pathum Kodikara, bank data operator Saranga Kosala and businessman Mohammed Inhamul Hashan were produced before the court by prison officials.

Submitting a further report to the court, the CID stated that the first suspect had gained the trust of everyone and had masterminded the fraud. 

The CID stated that the suspect had also facilitated loans through the bank for other officers of the institution. Owing to this close relationship, the other officers had allegedly failed to question his activities and had acted with complete trust in him.

At this point, the Chief Magistrate questioned the prosecution and inquired whether the bank’s audit reports had been taken into custody as previously ordered by the court.

In response, the CID stated that no audit had been conducted on the bank’s general ledger account since 2022. The CID further stated that statements had been recorded from an official of the audit division and that, according to her statement, a proper audit had not been carried out.

The Magistrate then observed,
“Is the audit officer who has served since 2022 still in service? I ordered that all internal and external audit reports be taken into custody. If that order has not been carried out, it must be implemented immediately.”

At this stage, counsel appearing for the suspects informed the court that annual audits had in fact been conducted and that such reports were public documents.

The CID, making further submissions, stated as follows:
“The first suspect had transferred Rs. 10 million to a Sampath Bank account in Pottuvil. That bank has lodged complaints with the Central Bank of Sri Lanka regarding that transaction and several other money transfers.”

The Magistrate again questioned the CID and inquired how many suspicious accounts had so far been identified.

Responding to the query, the CID stated that 900 accounts had been identified as suspicious accounts.

Reacting to the submissions, the Magistrate ordered the CID to submit a summary report regarding the response of senior bank officials in relation to these activities.

President’s Counsel Kalinga Indatissa, appearing for one of the suspects (4th suspect), submitted that it was unfair to place the entire blame for the fraud solely on their clients. Counsel further stated that the situation was an example of the saying that “water flows downward to the lowest point.”

After considering the submissions made by both parties, the Magistrate ordered the CID to submit a detailed report regarding any bank officials who may have neglected their duties.

The Magistrate further ordered that the audit reports and relevant bank records be taken into custody immediately and directed that a report also be submitted regarding persons who had failed to act on the recommendations of the Central Bank.

The suspects were ordered to be remanded till May 29.