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India, USA, UK experts to assist Central Bank conduct forensic audit
The Government intends to co-opt experts from India, USA and the UK to assist the Central Bank (CB) to conduct a forensic audit exercise in keeping with the recommendations of the Commission of Inquiry (CoI) that looked into the CB Bond issue.
“Additionally, amendments will be broughtto the Monetary Act as well as the Registered Stock and Securities Ordinance (RSSO), to implement the CoI’s recommendations. There will be a three-pronged approach to implement the CoI’s recommendation. The Attorney General’s Dept, the Legislature and the CB will handle different aspects to ensure swift action” said Deputy Minister of National Policies and Economic Affairs, Dr Harsha De Silva.
President Maithripala Sirisena as well as Prime Minister Ranil Wickremesinghe have promised prompt action to implement the recommendations of the CoI which handed over its report last week. The AG’s Dept has been asked to report back to the President’s Office within a week, on the legal aspects of implementing the CoI’s recommendations.
The CoI has, among others, recommended action against Arjun Aloysius of Perpetual Treasuries Ltd, former CB Governor Arjun Mahendran and former Finance Minister MP Ravi Karunanayake. Meanwhile, at a meeting held at the Prime Minister’s office on Friday, presided by Ranil Wickremesinghe, a committee comprising the CB Governor, Secretary to the Treasury and the Secretary to the Ministry of Law and Order, was appointed to look into the modalities of conducting the forensic audit examination.
The Deputy Minister said the audit would cover the Bond transactions as well as the EPF investments in the stock market in 2008, when there were heavy losses due to investments in loss-making companies. He added that PTL had registered as a Primary Dealer to operate on the Bond market, under then CB Governor Ajith Nivard Cabral, with several questionable transaction at the time too.
The three-member CoI comprising Supreme Court Judges Prasanna Sujeewa Jayawardana and K.T. Chitrasiri, and former Deputy Auditor General Veluppillai Kandasamy, was appointed in January 2017, to inquire into the issuance of CB Treasury Bonds from Feb.1, 2015 to Mar.31, 2016.