A Trust, independent of the Ceylinco Group and including four judges as trustees, is to be set up to plan and coordinate the recovery and repayments to depositors of the failed Golden Key Credit Card Co., the Mount Lavinia Chief Magistrate’s court was told on Friday.
The proposed trustees are Justice Andrew Somawansa, Justice Nimal Dissanayake Justice Stanley Gunawardene, Justice S. Wimalachandra, K.A. Wijesekera and Sujeewa Rajapakse, Deputy Solicitor General (DSG) Sarath Jayamanna told Chief Magistrate Harsha Setunga during the proceedings in the Golden Key (GK) fraud case in which six suspects have been remanded in connection with a fraud at the company.
Golden Key, part of the Ceylinco Group, collapsed late last year after depositors found the company was delaying interest payments and not returning deposits. The exposure (in terms of deposits) is as high as Rs. 26 billion, part of which State prosecutors allege has been misused by its directors and other Ceylinco Group directors including its well-known Chairman Lalith Kotelawala.
Friday’s court proceedings was action-packed with distressed depositors, at one stage ‘hooting’ lawyers for the suspects and receiving a warning from the magistrate, Mr. Kotelawala being accused of controlling the media to prevent coverage of the case, and lawyers for the Ceylinco Group failing for a fourth time to discuss the Trust matter. It was also disclosed that so far a sum of over Rs. 90 million has been paid (to depositors).
On Friday, two more directors Suramya Karunaratne and Niranjan Fernando were remanded by the Magistrate, joining four suspects - Deputy Chairman Khavan Perera, Finance Director Saradha Sumanasekara, Manoj Chaminda Jayalath of Ceylinco Insurance and M. Nallanthuvan - who continue in remand since the inception of this case. They were all remanded till February 26.
A list containing the names of 7,181 depositors, lower than the list of 9,200 depositors revealed in court earlier, was submitted to the magistrate by lawyers for Ceylinco Group. A document containing details of assets of the group identified by the company for disposal and settlement of security deposit card holders and the payment plan for GK depositors was also submitted to court.
The company has listed 29 companies with its assets amounting to Rs. 13.31 billion. According to the payment plan it has been suggested to set up a Trust in accordance with the agreement reached by the depositors’ counsel and the lawyers of GK management, along with the DSG, at a previous court hearing.
It has been proposed to transfer all the assets to the trustees to be sold to raise funds to pay the depositors. The Trust is outside the control of the Ceylinco Group. It was also suggested that the company will pay Rs.50 million per month to be paid to the depositors in any manner stipulated by the Attorney General’s Department. At present the monies are paid beginning with the depositor with the smallest deposit.
As at January 29, 2009 a sum of Rs. 95, 686, 287.83 has been paid.
Mr. Jayamanna informed court that counsel appearing for Mr. Kotelawala failed to turn up for a meeting (this week) at the Attorney General’s Department to discuss the setting up of the Trust., This is the fourth time that lawyers for the Ceylinco Group have failed to appear at these meetings.
This was a clear indication of disrespect for the Attorney General, he said. Mr Jayamanna said that the documents with details of assets and the payment plan for depositors were handed over to the AG’s Department by two Ceylinco directors, Bandula Ranaweera and S. Jegasothy who are on personal bail in this case.
The DSG told court that not a single electronic media has given any prominence to this case, leaving only a few leading newspapers to report the case as if ‘Lalith Kotelawala was a media mogul’. He added that the CID is continuing investigations and the Ceylinco Chief will not be allowed to evade his responsibility with necessary action being taken against each and every person who was involved in the financial misappropriation.
He also told court that Mr. Kotelawela had taken money from the Golden Key Co. claiming that it will be used for charitable activities. He disclosed that Suramya Karunaratne, one of the directors of the company, was responsible for siphoning off Rs. 6 billion of the deposits to several other companies of the Ceylinco Group.
He noted that Mr. Karunaratne should also take responsibility for making the Golden Key, a bankrupt company.
It has been revealed that Mr. Karunaratne’s Golden Key account exceeds Rs. 75 million and he has set up a company in Australia investing over 300 million Australian dollars.
Meanwhile inside the court chamber some angry depositors started hooting at Anil Silva, counsel appearing for Khavan Perera, when he was making submissions to seek bail for his client. The magistrate ordered the unruly crowd to behave properly threatening stern action to prevent the depositors entering the court.
The parties (on the Trust matter) agreed to meet at the AG’s office on February 19 (Thursday) and February 25 (Wednesday) to further discuss the modalities of the setting up of the Trust and the payment plan.
Chief prosecutor Mr. Jayamanne told court that, according to a financial statement submitted by the Golden Key Credit Card Co., Rs 13 billion had been misappropriated, Rs. 6 billion had been invested in other subsidiary companies of the Ceylinco Group, and Rs. 5 billion had not been accounted for. Total deposits amounted to Rs. 26 billion, he said.
Meanwhile the Golden Key depositors have formed an association to fight for their rights with the initial membership of 300 meeting for the first time at the Dharmendraramaya temple near the Mount Lavinia courts just before the court case on Friday.Association patron Parliamentarian Uduwe Dhammaloka Thera presided at the meeting. Subsequently a massive protest demonstration was held opposite court against the Ceylinco management headed by Mr. Kotelawala aimed at exerting pressure on the management to refund the money of Golden Key depositors as soon as possible. |
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