Two extraordinary – and rare -- board meetings of directors of two companies, F& G Real Estate Co Ltd and F&G Property Developers (Pvt) Ltd have been fixed for Thursday, August 27 and the next day, August 28 inside the Welikada Prison since most of the directors are on remand.
The Sunday Times FT last week exclusively reported about court sanction for these meetings to get the directors’ approval for a repayment plan for depositors of the failed companies. The two board meetings are being held to pass a resolution approving the setting up of an independent trust to facilitate repayment of some 5,600 depositors on a Court directive following submissions made by Deputy Solicitor General (DSG) Yasantha Kodagoda. He said that at least 30% of the deposited money could be repaid by selling the assets and property of the F&G Group.
In another startling revelation, Mr Kodagoda told court this week that the companies, which are not registered finance companies, continued to accept deposits even after they became insolvent way back in March 2008. The company failed to pass the solvency test in accordance with the new Companies Act, he said. Depositors and creditors were not told about the liquidity problems of the company and no action was taken to liquidate the company by the directors.
These cases and others involving the Ceylinco Group have seen most of the top Group directors led by its Chairman Lalith Kotelawala being brought to court, almost weekly, from remand custody and returned back, with bail applications pending. Only Deputy Chairman Sicille Kotelawala, also wanted, is out of reach of the law and believed to be hiding in Singapore. |
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