fraud: Racketeers build fortunes in Asia, Africa
By Asif Fuard
Suspects who struck it rich in the VAT refund scam have illegally
sent out vast sums of money for investment abroad, ongoing CID investigations
suspect, S. Subramaniam, described as a textile tycoon had allegedly
invested large sums of money in Uganda and Vietnam. It was revealed
earlier that he had purchased a Rs. 100 million house in Trichy,
Due to questions arising from Subramaniam’s operations in
Uganda, the Ugandan government appointed a special fact-finding
committee to probe into his businesses in Colombo. The Ugandan team
sent to Sri Lanka went back empty-handed as the Central Bank reportedly
did not make a great effort to co-operate with the Ugandan team.
suspect, Kamil Kuthubdeen, described as a kingpin of the racket,
is alleged to have illegally remitted funds for investment in Singapore,
Australia and Malaysia. Earlier it was revealed that he had purchased
a three star hotel in Dubai with funds he had allegedly obtained
through VAT refunds on non-existent companies.
probe into the scam had also revealed that the suspect Rasheed Murshid
who is evading arrest purchased a mansion in Malaysia. It is believed
he had also illegally sent the money abroad when making the investment
for the purchase.
Deputy Commissioner of the Inland Revenue Department VAT refund
division Z. Jayathilake who was the first person to be nabbed in
the VAT fraud had reportedly invested his money in Australia as
well as in Singapore.
Before Jayatilake came back to Sri Lanka he is said to have spent
18 days in Singapore in a flat which was bought with funds fraudulently
obtained. The CID has found that the Central Bank has no records
of him being sanctioned to remit money to purchase properties abroad.
Rs.3.57 billion VAT scam came into light when the Auditor General
discovered a deficit of a vast sum of money in the Inland Revenue
VAT refund division. The investigation which was handed over to
the CID made a breakthrough when Jayatilake who was visiting Sri
Lanka was nabbed. According to detectives Jayatilake had gone to
New Zealand when the audit queries were first raised. So far five
suspects have been arrested while the CID is still trying to locate
the rest of the culprits of this massive scam.CID detectives are
now awaiting information from Interpol Headquarters in Leon, France
to help formulate a full account of the illegal investments abroad.
This is a prelude to investigators making contact with their counterparts
in those countries prior to visiting them.
to investigations there was no record of any money transfers by
the suspects. A Central Bank official who could help detectives
with further information is said to be absconding. In a few instances,
however, recipients of illegal funds had obtained Central Bank approval
to remit the money abroad. They are now to be questioned as to how
they acquired the money.