High-riding cowboys in daylight robberies

The buyer called it a "strategic initiative", the seller said it was a "horizontal integration"; all pedantic phraseology, but an opposition MP has come to the more accurate conclusion to describe it as "a sophisticated bank robbery".

The President has long been faulted for permitting a bitter turf battle to continue between the heads of the Treasury (Ministry of Finance) and the Central Bank, but it seems there is some wisdom in his 'divide and rule' policy. Had it not been for the whistle-blowing by the Treasury, this whole episode involving the almost iconic National Savings Bank (please see details on page 1 and in our Business section) would not have come to light. The fingerprints of the Central Bank are all over this shady deal relating to the purchase of shares at an inflated price in a private deal with the money of millions of savings account holders. The trail leads irresistibly to the highest levels of the Central Bank. The self-imposed deafening silence by the Central Bank, which is normally quick to hold news conferences, can be seen, at the least, as dereliction of duty because it is the Central Bank which must monitor these underhand activities.

The media have done well to expose what has been a web of manipulation by a familiar group of people commonly referred to in the marketplace as "the cowboys". It is now a public secret that they have made the Stock Market a casino, turning black money into white, buying up company after company and real estate with sheer impunity. The deals they were involved in were so hot that a respected public servant resigned her job as the chairperson of the Security and Exchanges Commission (SEC), but the public was not given the benefit of knowing why she quit.

Both the SEC and the Colombo Stock Exchange have been accused of being toothless and spineless in regulating the share market, and the government must know why foreign investors shy away from being an investor in the murky waters of Sri Lanka's stock exchange.

The NSB fiasco was not just a sophisticated bank robbery, it was daylight robbery. Those involved would not have for a moment thought that the unions would run to the Treasury and complain, and even if they did, they knew jolly well that no harm would come their way. The worst that could happen would be the cancellation of the sordid transaction, and they would get their money back. That is because there is complicity in these crimes by influential personalities in the government.
Of late, the Central Bank's aggressive interventions, or more to the point, interference into the mainstream banking sector (which stood the test during the 30-year long separatist insurgency), has grown from a whisper into a murmur and now to full blown vitriol. Its 'agents' sit on the Boards of Banks and Finance Companies giving directives seemingly emanating from the Central Bank whose tentacles are everywhere. Its role as the 'Bankers' Bank' is replete with contradictions and conflicts of interest.

The NSB's self-incriminatory statement after its botched attempt to buy into The Finance Company was pathetic, to say the least. They tried to engage in damage control only after the deal was exposed, but the defence was as bad as the offence. They left the vital question, the reason for the inflated price for the shares they purchased, unanswered. One expects the entire incident to blow over, hushed up and dumped in the dustbin of forgotten things very soon. But not only will the bad taste linger, the government's utter disregard for taking action against those who racket in public funds, especially when they are its political backers or financiers, will be another indictment on its legacy.

Crimes against people by those with patronage

The culture of disregard for squandering public money is best illustrated in the manner in which the government is treating the Parliamentary Oversight Committee on Public Enterprises (COPE) report. This report, which followed the Auditor General's report identified areas of colossal waste, mismanagement and corruption in the public sector in recent years. Again, after the Media hammered away on the theme that the government had relegated both these reports to gather dust on some shelf of the Presidential Secretariat, we now see some movement in this regard. A debate ensued in Parliament this week and the COPE Chairman is quoted in this issue (please see page 4) giving some kind of roadmap for action on the committee's recommendations.

We just hope that the efforts don't move at snail's pace. The Chairman says a positive sign has emerged and that is that annual reports of public institutions are now up-to-date. Gone are the days, he says, when these corporations submitted their annual reports when governments had changed or the directors were no longer in the land of the living.
But what of the wrongdoers? The public, or at least the discerning public would surely like to see punitive action taken against the wrongdoers, particularly those deliberately engaged in wrongdoings. To say that the President has removed six or seven chairmen from their posts is not enough because these folks have a way of worming themselves back to high office somewhere else.

An opposition MP referred to the goings on at the Public Trustees Department. We have referred some time back to what goes on in this Department that bears the name 'Public Trustee'. A government MP who has obviously studied the COPE report pointed out during this week's debate how Sri Lanka Cricket, for instance produced duplicates and blank sheets claiming to be extracts of meetings or a true copy of a letter to the Minister. This is the rubbish that has also got into the COPE report slipping through the scrutiny of its members.

The finances of Sri Lanka Cricket were one big scandal and the institution that co-hosted the World Cup last year is broke. Where has all the money gone during the period of an Interim Committee, not elected, but appointed by the Minister of Sports? The assets acquired by the committee members during their tenure of office may give a clue. Today, the Cricket Board must run to the cabinet to be bailed out.

And then, the government must increase the price of bread, milk powder, bus fares, petrol and kerosene, gas and dhal of the long suffering people, and the rupee takes a tumble for the wanton follies and crimes against the masses by a few rascals peddling the patronage of the powers-that-be.

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Editorial Archive 2012 
01st January 2012 - The hopes and fears of 2012
08th January 2012 - Education fails
15th January 2012 - Ties with India vital but not at any price
22nd January 2012 - Handling India the President's way
29th January 2012 - Political stability - not autocracy
05th February 2012 - Freedom struggle continues overseas
12th February 2012 - Lesson from the Maldives: Listen to the people
19th February 2012 - Belt-tightening must start at the top
26th February 2012 - Good governance the answer
04th March 2012 - Treasury acting like the Kremlin
11th March 2012 - Women as Agents of Change
18th March 2012 - India: To be or not to be with Lanka
25th March 2012 - Reassess foreign and domestic policies
01st April 2012 - Stop quibbling; implement LLRC report
08th April 2012 - Bouquets for BRICS
15th April 2012 - Hope for the best, prepare for the worst
22nd April 2012 - The intricacies of the Indian factor
29th April 2012 - After Geneva: Act effectively, but carefully
06th May 2012 - Cost of living: Blow after blow
13th May 2012 - High-riding cowboys in daylight robberies
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