News

The Commission to Investigate Bribery or Corruption has started an inquiry into the assets acquired by Chief Justice Shirani Bandaranayake whilst a foreign travel ban has been imposed at its request on her husband Pradeepa Kariyawasam, who was the former Chairman of the National Savings Bank (NSB).

“We have received a complaint against the Chief Justice about accumulation of assets. We are investigating the complaint. It has been sent under a name and therefore like any other complaint we receive we are investigating the allegations,” Commission Chairman Jagath Balapatabendi told the Sunday Times. He declined to name the complainant or elaborate.

This is the first time in the Commission’s history that a serving Chief Justice is being investigated over an issue involving assets.

A Commission official said she would be issued a “show cause notice” and further inquiries would proceed only thereafter. The move comes in the wake of the government members in the Parliamentary Select Committee (PSC) finding Chief Justice Bandaranayake guilty of three charges.

One of the charges is “not declaring in the annual declaration of assets and liabilities that should be submitted by a judicial officer the details of more than twenty bank accounts maintained in various banks including nine accounts” in the National Development Bank (NDB).

Earlier this year Mr. Balapatabendi said more than 60 complaints of corruption and illegal assets acquisition against politicians including MPs, Provincial Councilors (PCs) and members of Local Authorities were under investigation.

The Sunday Times also learns that the Commission has also told the Department of Immigration and Emigration that a travel ban be imposed on Mr. Kariyawasam. His passport and other details have been made available.

Consequent to the request, the Department has told its officials at airports and seaports that Mr. Kariyawasam’s name should be included on the banned list. Any person banned from leaving the country is usually detected when he reaches the immigration desk and the officer there verifies his particulars from a computer linked online to the Department. A banned entry triggers an alarm alerting the immigration officer.

On October 25, the Criminal Investigation Department (CID) filed plaint against Mr. Kariyawasam before Colombo’s Chief Magistrate Rashmi Singappulli. Mr. Kariyawasam has been charged with “causing a loss of Rs. 391,137,554.33 to the state due to the transaction of purchasing 7,863,362 shares of The Finance Company during the period March 14, 2012 to May 3, 2012.”

He is also accused of corruption for recommending his own name and that of Shan Chandrasekeran Shanmuganathan to be appointed as members of the Board of Directors of The Finance Company. According to the plaint, the offence had allegedly been committed on April 27, 2012 or on a date close to it. The plaint has listed 51 documents and 26 witnesses. The Court has directed Mr. Kariyawasam to appear on February 28 next year.

In May, President Mahinda Rajapaksa ordered the cancellation of a stock-exchange deal where the NSB had bought 7,863,362 shares of The Finance Company at Rs. 49.74 a share when it was claimed that the price of shares was as low as Rs. 30. The NSB had paid Rs. 391 million, though the transfer of the funds was reportedly halted.

Major controversy erupts over exposure of CJ’s bank accounts

Amid controversy over the NDB Bank’s disclosure of bank accounts of Chief Justice Shirani Bandaranayake, another private bank says it refused to release this information.

Informed sources at this bank said they had also received letters from Parliament and the Criminal Investigation Department (CID) seeking information of Ms. Bandaranayake’s bank accounts.
“We sought legal advice and based on that we refused to divulge such information. We were told that we could be sued if such information was released,” one bank official said.

He requested anonymity and also that the name of the bank be withheld. These details were bared just as a major controversy erupted this week over the right of banks to release details of customer accounts under secrecy laws.

Earlier in the week, good-governance campaigner Chandra Jayaratne fired a letter to the Sri Lanka Banks’ Association challenging the right of banks to release personal details of a customer, in this case the Chief Justice, saying it was a violation of the secrecy laws governing banks. When asked about the disclosure of the CJ’s accounts, NDB Bank Chief Executive Officer Russel De Mel said it would be unethical to comment since the parliamentary process was going on.

“All that I can say is that the NDB followed an ethical and correct process on eminent legal advice,” he told the Sunday Times.Adding to the confusion, Attorney General Palitha Fernando told the Supreme Court on Friday the Parliamentary Select Committee (PSC) process was not a judicial trial but a disciplinary hearing. The AG’s remarks came during the hearing of a petition seeking constitutional interpretation of the procedure to impeach a judge of the Supreme Court. Section 30 of the Banking Act of 1988 provides for banks to provide information on accounts of customers on a court order.

The issue relating to secrecy laws was the talking point in banking circles this week and whether the PSC is a judicial body and has a right to such information. “The advice we received is that details of a customer’s account must be released only on a court order or on a directive by the Central Bank (CB) as the regulator,” the source at the bank, that refused the information, said.

Other officials in the banking industry said that the CB and the Inland Revenue Department had the authority to call for such information but for internal purposes and not for public consumption. Only a court order could publicly reveal the details of customer accounts of a bank.

However a lawyer familiar with banking laws said such information could be released to the public if it was in the national interest, citing the case of the Tamil Rehabilitation Organisation (TRO) whose accounts were frozen on the grounds that it was an LTTE front organisation.

“On the other hand public interest provisions relating to banking secrecy laws is wide and leaves a lot of room for interpretation,” the lawyer said.

Follow @timesonlinelk

comments powered by Disqus

D-day for planet earth: Everyone’s talking about it

Minister seeks Cabinet approval to allegedly repay unqualified recruits

Tremors in Ampara leave villagers shaken and officials guessing

Kahawatte: Fear is the key

Big or small, no animal is spared on Yala ‘killer-road’

Road races flagged off amidst groans, cheers

Mining dries out livelihood

Stop this barbaric act!

Answers to Appeal Court queries will be sent in due course, says SC