Vignarajah urges President to ensure level-playing field for investorsView(s):
K.C. Vignarajah, a veteran stock market investor who has been fighting for the rights of small shareholders in companies, has urged President Mahinda Rajapaksa to ensure a level playing field for all investors in the current depressed market conditions.
In a letter that was handed over to Gamini Senerath, Additional Secretary to the President, during a meeting called on July 20 by the President to discuss market issues, he said: “Your Excellency’s ambition to fly the flag of our country high is being undermined by many extremely selfish persons. You have great potential to do good by defending the actions of the regulators to do their duty of protecting the investors, create level playing field and ensure fair play.”
The letter, which thanks the President for inviting all stakeholders for the July 20 discussion (in which Mr Vignarajah was present), deals with a range of issues. “The propaganda built up by certain sections of the media, influenced largely by the wrongdoers, (insider traders, market manipulators, front-runners, ‘pump and dump’ artistes) who have been checkmated by the strong SEC. It appears to be orchestrated to replicate last year’s very sad saga of the crooked operators boasting that they were able to move out honest outspoken Ms. Indrani Sugathadasa and her able DG Malik Cader. Investors’ confidence was shattered and market continued to decline,” he said.
The letter noted that Thilak Karunaratne was appointed as the Chairman of SEC and Prof Dr Harendra Dissa Bandara was appointed acting DG. Within a very short period of time, they have established tremendous reputation of honesty, efficiency and sturdy independence. “The mafia seems to have surges of maniacal anger whenever good, honest and truly patriotic persons go about doing their duties and protecting the innocent decent citizens of the country from being grossly exploited. The decent investor’s confidence is gradually coming back,” the letter noted.
He said some of the well-known causes of the downfall of the market are:
- Rampant insider trading, market manipulation, front running, ‘pump and dump’ antics of the wrongdoers.
- Bad corporate governance. Absence of truly independent directors and auditors.
- Controlling Interests (CIs) manipulating financial statements/annual reports to create depressing “shareholder fatigue”. Suppression of material information including proper valuation of assets etc.
- CIs of public listed companies siphoning off profits and spinning off valuable assets to subsidiary/associate/private companies where the CIs stakes are higher or total.