Financial Times

Financial irregularities of Golden Key revealed


The 3-member Committee of Chartered Accountants appointed by the Supreme Court to examine the assets of the Golden Key Credit Card Company (GK) and submit a payment plan for depositors has unearthed several serious irregularities in financial transactions of the company.

A report of their findings and recommendations, submitted to the Supreme Court by Attorney General Mohan Peiris on Monday, revealed a possible fraud in the sale of shares of GK to Ceylinco Insurance PLC Gratuity Trust Fund and in a deal relating to the GK Eye Hospital.

“Sale of shares of GK need to be investigated as we were informed that Rs 500 million has been received by the Ceylinco Insurance PLC Trust Fund from the sale of shares. A sum has been credited to the Ceylinco Consolidated Bank account to repay depositors of GK. However the transaction has not been registered in the name of the party that has advanced the funds. On perusing the accounts of Ceylinco Insurance PLC, it was revealed that the purchase consideration was only Rs. 250 million,” the report, a copy of which was received by the Sunday Times FT, said.

Another GK issue was the loan granted to GK Eye hospital amounting to Rs 843 million which is being investigated. The committee has also detected details of two sets of accounts maintained by GK. One set of accounts has been prepared by extracting accounting information generated from the IMAS system, and the other set of accounts prepared on an excel sheet. Therefore, it has become necessary to verify the accounting information to assess the correctness of the figures reported, it said.

It also reported that 62 directors of GK and its subsidiaries and 24 companies of the Golden Key Group have so far failed to make their asset declarations to the Central Bank in accordance with the court directive. Ceylinco Chief Lalith Kotelawala has made only a partial declaration.

The committee has found that there are 46 local companies and nine foreign companies in the group and the total dues from these companies and other related entities amount to Rs 5.9 billion. It has been revealed that most of these companies are not in operation and employees of those companies have already left. The committee noted that there is no way to recover this money from these defunct companies.

Meanwhile at the GK fundamental rights hearing, Attorney General Mohan Peiris told Court that the GK Chairman and its Directors should within two weeks make a threshold payment of Rs. 1 billion to commence repayment to depositors on sums below Rs 1 millin based on a percentage varying from 25% to 50% from the smallest deposit first going upwards on a committee-approved criteria. For the balance payment a scheme of payment will be submitted within a period of four weeks.

Top to the page  |  E-mail  |  views[1]
Other Financial Times Articles
> Motorists ‘must’ report accidents
> Helicopter flights on the rise after war
> SriLankan crew gets new kit
> Financial irregularities of Golden Key revealed
> CB investigates NTB forex loss
> North to double GDP contribution by end-2010
> COMMENT - Reporting accidents now compulsory
> Need for Fair Trade in Sri Lanka
> Tourism – Another perspective as the industry recovers
> PBJ plea in Supreme Court next month
> Classified at your finger tips
> CSE trading floor reopens tomorrow
> Rice snacks to hit the Sri Lankan market
> Concern over revenue, expenditure targets in budget
> Leo Burnett wins AME award for 5th consecutive year
> NDB launches operations in Bangladesh
> Lankan companies optimistic about future
> Central Bank purchased $652 million this year to prop forex reserves
> Citi Sri Lanka names new CEO
> Lanka shippers seek lower insurance premiums
> Lecture on business in post-war Sri Lanka
> 'Hikka Fest' biggest beach show in Asia says Mustapha
> HSBC named best global bank by Euromoney magazine
> US economy on recovery but oil and food prices to spike again
> IT-BPO Career Fair draws crowds in Kandy
> Comprehensive Resort Hotel Guide out in November
> Theva Residency opens in Hantana Kandy
> International Fiscal Association’s seminar on taxation
> Microsoft's Sinhala and Tamil versions now freely available
> Some directors of Ceylinco Shriram Capital Management remanded
> Lankan growth can be boosted through IT - Gates
> Ceylinco Life market share grows to nearly 35 %
> Company directors course from CIMA/SLID
> CB account for cash donations to relief effort
> Call for environmental professionals to intervene in garbage issues
> LMRB head steps down
> Saleem head-hunts for Maldivian Bank


Reproduction of articles permitted when used without any alterations to contents and a link to the source page.
© Copyright 2009 | Wijeya Newspapers Ltd.Colombo. Sri Lanka. All Rights Reserved.| Site best viewed in IE ver 6.0 @ 1024 x 768 resolution