ISSN: 1391 - 0531
Sunday, March 25, 2007
Vol. 41 - No 43
Financial Times  

BOI says officer involved in fraud dismissed


Shocking fraud by former BOI official

It was shocking to read your news item titled ‘Massive fraud by former BOI official’. What is shocking is that the fraud was committed in June 2005 and discovered only in October 2006. What kind of accounting system and controls does the BOI have that it took so long to discover a fraud this huge.

With all the advanced IT systems available, one can only conclude that the BOI doesn’t have the managers who are capable of making decisions that the computer system produces at electronic speed or too lazy to investigate information or the parties are acting in collusion! Rs. 9.8 million surely, should raise the eyebrows even of a junior cashier! Frauds can and will take place in any organization.

It is to minimize this occurring that well thought out accounting systems with built in controls are installed. There is no substitute for this.

A few weeks ago, The Sunday Times highlighted the irregularities and alleged frauds published by the COPE chairman Wijedasa Rajapakse MP.

We were looking forward to the parliamentary debate of this report, but it simply fizzled out with no action.
This is because the report is compiled, I believe from the reports sent in by the Auditor General after completing the audit of the institutions that come under the jurisdiction of COPE.

This takes perhaps even three to four years after the submission of the final accounts by the institution concerned. Hence the Wijedasa Rajapakse report should have mentioned that the report is in respect of a particular year.

The public may have got agitated that all these frauds and misdemeanors have taken place in this last year! This as a report for action is of little value, because the incidents have taken place so many years ago and is an attempt to ‘close the stable doors after the horse has bolted’!

What COPE can however do, is to instruct the Auditor General to carry out interim audits of all government institutions and notify COPE through Interim Audit Reports to enable COPE to investigate almost immediately any irregularities and take whatever action available to them. The same procedure should apply where the audit is done by auditors from the private sector.

P. S. Mahawatte
Colombo 5.

The Board of Investment (BOI) of Sri Lanka has sent a clarification to a report in The Sunday Times FT last week relating to a fraud by a former BOI Official. The BOI said the officer mentioned in the article has already been dismissed with effect from January 18, 2007 by the BOI and therefore is no longer in service.

It said the matter referred to in the newspaper had not been brought to the notice of the BOI by the investor mentioned. “We have therefore referred this matter to the Criminal Investigation Department (CID) for further investigation and necessary action,” the BOI said

Our reporter says:
The former employee, Buddhi Jayasinghe, who is referred to in the letter by the BOI was attached to the Promotions Department and defrauded the investor, who had been given BOI status for a project in Nuwara Eliya. All this was done with the knowledge and assistance from his father-in-law who was subsequently brought to the CID for questioning in November 2006 when the investor filed a complaint.

Dr Wickrama Weerasooria, the investor’s authorised representative said that during questioning, the father-in-law 'gave a letter in his own handwriting saying this fraud was committed by his son-in-law.' Jayasinghe and his father-in-law have since disappeared and are unable to be located. Dr. Weerasooria stated that his client did not inform the BOI directly because his intention was not to bring charges against the BOI but only against Jayasinghe, adding that the complaint was lodged with the CID in November of last year, the CID has informed the BOI of their investigation.

He said that he has informed BOI Chairman, Lakshman Watawala and Minister of Enterprise Development and Investment Promotions, Sarath Amunugama of the fraud after he took up the case. He also said that Jayasinghe was asked to liaise with the client by the BOI Director of Promotions and has spoken with the BOI Chairman this past week who said he will assist in locating the former employee. Moreover Dr Weerasooria said it should be noted that even though the article was published last week omitting Buddhi Jayasinghe's name, the BOI has 'made the connection between the fraud and the former employee.'

The investor has been informed that this same BOI official has defrauded other BOI investors as well. “For the BOI to argue that the investor himself had not officially complained to the BOI is a little amusing coming from Sri Lanka's main gateway to foreign investment. Also why was the BOI official dismissed?” Dr Weerasooria asked. (NG)



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Copyright 2007 Wijeya Newspapers Ltd.Colombo. Sri Lanka.