Friends with Benefits: A revelation by Voice against Corruption on A.G report

Friends with Benefits: A revelation by Voice against Corruption on A.G report

By Tharushan Fernando

31 Jan, 2017 | 8:10 pm

The Voice Against Corruption points out that the most recent report of the Auditor General reveals how authorities ensured that their friends and acquaintances received all the benefits.

CaptureThe report which was compiled based on a request of the minister of finance details the transactions of Central Bank treasury bonds over the past 8 years.

On the 19th of August 2016, the minister of finance made a written request from the auditor general to submit a
report which answers specific queries on the bond transactions of the Central Bank from 2008 to 2015.

In response the Auditor General stated that he would compile such a report, even-though it does not fall under his direct purview, taking into consideration the national relevance of the request.

According to the report treasury bonds had been issued to primary dealers through direct placements during the period between 2008 and 2015.

However primary dealer perpetual treasuries, who has been linked to allegations of a bond scam only received Rs2.5bn worth of direct placements through 13 bond issuance’s in 2014.

However the during the controversial bond issuance that took place on the 27th of february 2015 after Arjun Mahendran took the helm of the Central Bank as it’s governor, perpetual treasuries obtained bonds worth 5 billion rupees.

Even though the Central Bank only called for tenders worth Rs.1 billion, the central bank ended up issuing treasury bonds worth 10 billion.

Allegations were leveled that the decision to increase the value was not informed to the primary dealers. This allegation was also accepted by then CBSL Govenor Arjun Mahendran.

According to the Voice Against Corruption ,the report makes it crystal clear that Perpetual treasuries which is owned by the son in law of Arjuna Mahendran obtained treasury bonds worth Rs 2.5 bn during the course of 2014. However this figure rose to Rs.75bn in 2015 and even though this was obtained through tenders, the sudden increase from 2.5bn to 75bn clearly shows how the Father in Law and Son in law acted.

WASANTHA“It is clear that this deal which caused a major loss to the central bank as well as the EPF was clearly planned out. In a few days we can see how much he purchases in 2017 because his father in law is no longer in control.”said Wasantha Samarasinghe

He charged that the activities of some of the leading ministers of the UNP to justify these actions is simply disgusting and they will not allowed to cover up anything.

“We will ensure that those who committed fraud are punished and that the money that was stolen is returned ..” he said

The Sri Lanka Audit Service Association says that certain political leaders are trying to cover up their own fraud

According to the President of the Sri Lanka Audit Service Association some political leader have begun to say that the reports of the Auditor General are wrong or perhaps that the procedure followed is wrong in order to cover up their own fraud and corruption

[quote]”We see this as an attempt to protect the corrupt and their activities and also to create a mindset among the general public that the reports of the Auditor General are not up to standard. All of you are aware that the Auditor General’s report is the only evidence to prove if there has been any kind of irregularity here or if they have violated the proper procedure. The Auditor General’s report is the only report which exposed that the country has incurred a loss” – K.N.M. Kumarasiri (President of SL Audit Service Association )- [/quote]

The Sri Lanka Audit Service Association points at a paper article here which reports the World Bank as saying that the audit report on the bond issue is in violation of the universal system.

“We contacted the World Bank and requested the report which was sent to them and here is that report. This report was submitted to the Secretary to the Prime Minister on the 7th of December 2016.”said the Vice President of the SL Audit Service Association who added that the report does not say that the audit report is in violation of the universal system

Sri Lanka Audit Service Association charged that the report in this newspaper is an absolute lie and has been based on a report sent by the Prime Minister’s office.

The Vice President explained that when the Auditor General makes a statement on a professional basis, he follows other audit and accounting standards to base his statement and the report on the bond issuance was compiled by following these procedures,therefore this audit report has been drafted in accordance with relevant parties and professional measures.