Financial Times

CB urged to expedite the GK repayment plan

By Bandula Sirimanna

The Central Bank Special Task Force on the Golden Key Credit Card Company Ltd is processing the list of GK depositors who forwarded their details as per the Central Bank’s news paper advertisement published on the 23rd of April 2009 in pursuant to the Supreme Court Order.

A senior official of the Central Bank said that they have so far received details of around 3,000 depositors and they are still receiving details although the deadline was fixed on the 15th of May 2009. The list of depositors processed by the Central Bank will also be forwarded to court on the next hearing date of the FR case on September 1.

He said that the re-payment plan is expected to be placed before the Supreme Court (SC) for sanction. A decision on depositors numbering around 4,200 who failed to submit their details would be taken after seeking a Court Directive on this matter. The SC earlier directed that the process of settling depositors begin on the basis of the lowest value with those who were wholly dependent on the interest earned to be given priority. The Committee of Chartered Accountants appointed by the Supreme Court to devise a repayment plan and to asses and value GK properties and assets has suggested that the first payment could commence for sums below Rs.1 million based on a percentage varying from 25% to 50%.

However the Committee noted that the Chairman and Directors of Ceylinco Consolidated and GKCL should take action to bring in a minimum sum of Rs. 1 billion immediately to commence repayments to depositors on sums below Rs1 million on the outstanding deposits and the percentage of payment .
He said that there was no response from the GKCL management with regard to this matter so far. The committee also recommended that the Chairman and Directors of Ceylinco Consolidated and GKCL to provide a solution on the manner in which depositors are to be repaid. A senior official of the Central Bank said that this was not materialized as yet.

Central Bank officials have discovered that some of the valuable properties of Ceylinco group in Colombo had already been mortgaged, and under the law, they have to settle these primary mortgages on auctioning the properties and utilize only what’s left to settle depositors.

Meanwhile the GK depositors Association has written a letter to the Central Bank to expedite the preparation of the repayment plan without waiting to obtain details of the total number of depositors. A senior official of the Association told the Sunday Times FT that they have made a request from the CB to devise the plan first for around 3000 depositors who have submitted their details.

Meanwhile in another development Golden Key Credit Card Company director Daniel Jegasothy was released on strict bail conditions after he gave an unconditional undertaking to assist the CID and the Central Bank in their investigations.

High Court Judge Deepali Wijesundara released Mr. Jegasothy on a cash bail of Rs. five million and personal bail of two sureties fixed at Rs.25 million each. The Court also impounded his passport and ordered that the sureties handover their passports as well and directed Mr. Jegasothy to appear before the CID once a week.

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