COPA summons report from CBSL on actions taken against illegal financial instiutions during past 20 years

COLOMBO (News 1st):- A report has been called on the steps taken by the Central Bank of Sri Lanka against illegal financial institutions during the past 20 years. The Committee on Public Accounts (COPA) has called for a detailed report on the steps taken by the Central Bank against the said financial institutions. The COPA has ordered for the report to be submitted before September 10th. COPA issued the order when a group of institutions including the Central Bank were summoned before the committee. It was also revealed that legal action has been taken against several illegal financial institutions during the past 10 years. Director of the Department of Supervision of Non-Banking financial institutions, W. Ranaweera said that they have filed legal action against more than 18 institutions and that the respective directors have been barred from functioning and have been sentenced to jail. He added that a few of them are in prison already. The investigations had revealed that institutions carrying out financial activities in the guise of co-operatives had been collecting money from the general public through illegal means. However, the Central Bank only regulates financial institutions registered with the Central bank. Thereby legal action can be filed against institutions who accept deposits illegally from the general public, evading the Central Bank, through the provisions of the Finance Business Act, No. 42 of 2011. Chairman of COPA, Lasantha Alagiyawanna said that the CBSL must focus their attention on amending the laws and reducing such incidents in future, to which the officers responded that a draft has been prepared with the required amendments to the 2011 act and that they hope to pass the act in parliament before the end of next year.   https://youtu.be/aCdti6mSrVI