Desperate CIFL depositors reject liquidation proposal from Ravi
While the new government has promised relief to victims of collapsed financial institutions, depositors of the Central Investment and Finance Ltd (CIFL) fear they have fallen from the frying pan to the fire.
According to K.W. Gunawardena, President, CIFL Depositors Association (CIFLDA), at a meeting they had with Finance Minister Ravi Karunanayake on Monday, the Minister had indicated that the failed CIFL should be liquidated to solve the crisis of this company.
Depositors were also told by the Finance Minister that the association should not go to courts against the Central Bank (CB) and they should abide by whatever decision taken by the regulator.
Present at the meeting, along with officials of the CIFLDA, were CB Governor Arjuna Mahendran,; Ms K. M.A. N. Davulagala, CB Director Supervision, Non-banking Financial Institutions (NBFI) and Kamal Dissanayake, CB Assistant Director, NBFI.
Mr. Gunawardena said they rejected the Minister’s proposal to accept liquidation and requested the Government to allocate financial assistance to restructure CIFL and to find an investor to resurrect it.
As an immediate relief CIFLDA requested an interim payment for the depositors from the accumulated interest in CIFL. They wanted the government to recover this money from Deepthi Perera, former CIFL Chairman, alleging that he had ‘stolen much of the assets of the company’.
The association pointed out to the Minister that Mr. Perera was recommended by the former CB Governor, Ajith Nivard Cabraal, as a fit and proper person.
Their other requests are: investigate all fraudulent financial transactions of CIFL; have a comprehensive audit report for the year 2013/14 as per Finance Act; and investigate and frame charges against the former CB Governor related to all CIFL matters on appointments, approvals and supervision and several other matters.
CIFLDA had also pointed out to the Minister that the KPMG audit firm was entrusted with submitting a report on CIFL and to which CB officials have said that they have not received such audit report. Mr. Gunawardena said the Minister then immediately contacted KPMG and required them to submit this report before 31 March. Mr Karunanayake also instructed the CB officials to call for a meeting with CIFLDA and CIFL Directors, along with CB officials.
On Tuesday, the CIFLDA held a massive demonstration at the turn-off to the Parliament in Kotte attended by all the CIFLDA members across the country at 1 pm in time when the MPs travelling to Parliament for the afternoon session.
As requested by the CIFLDA, Minister Karunanayake briefly met the protesting CIFL depositors and assured them relief.
Meanwhile JVP Parliamentarian, Sunil Handunhetti addressed the protestors and said that what was faced by CIFLDA is very unfair and it was irresponsibility on the part of the Government and assured them that he would raise this matter in Parliament.
Some of these protesting CIFL depositors who were sick and struggling to survive told the Business Times that it appeared that this government is worse than the earlier one by trying to liquidate CIFL and preclude them from seeking relief through courts.
One such desperate depositor, who wished to be anonymous said, “Den thiyena aanduwa hariyata ‘Kahi Genii deelaa, Hottu Genii gaththa wagai’” (Exchanging the coughing woman to a woman with a cold).