Police bar hapless depositors of Standard Credit and Finance from protesting outside Central Bank
Several dozens of hapless depositors of the Standard Credit Finance Lanka Ltd (TSCFC), protesting near the Central Bank (CB) headquarters in Fort on Monday, were however unable to seek an ‘audience’ with the Central Bank Governor Arjuna Mahendran.
Protesting near the Central Bank
The depositors, many aged and ailing, stayed outside the building for four hours (9 am to 12 noon) waiting to hand over a letter to expedite relief to them but their hopes were shattered. The letter was however delivered to his office.
They carried placards and shouted slogans, in front of the ‘Ceylinco House’, Fort, waiting to meet Mr. Mahendran, to discuss their plight and hand over a letter. The demonstrators wanted to march across-the-road to the Central Bank building but were prevented from doing so by the police.
The protestors sent emissaries to seek an audience with the CB Governor but they failed.
This rebuff by the CB Governor would be reported to President Maithripala Sirisena, depositors said.
S.T. Kodikara, Additional Secretary to the President undertook to intimate to the President of this situation, according to Ravi Rajapakse – a depositor.
The organizers of the protest told the Business Times that they were trying to meet the Governor for the last two years to no avail.
An irate middle-aged female depositor, leaning on the parapet wall in front of the ‘Ceylinco House’ who apparently deposited large sums of money in several of these failed financial companies, said that the CB Governor is duty bound to resolve their issues. She lamented that they are part and parcel of the development strategy of the country and the safety of their funds is the bounden duty of the government.
The letter to the CB Governor by the Deposit Protection Society of the Standard Credit Finance Ltd indicated that this appeal is directed to the CB Governor on behalf of nearly 4,000 distressed depositors of TSCFC.
It said that on 22.3.2011, the CB appointed Entrust Ltd (Entrust) as the Managing Agent of TSCFC with a controlling shareholding of 70 per cent.
In response to, a direction issued by the Monetary Board of the CB, their fixed deposits were converted into shares with a view to quickly recover their monies.
Accordingly, the depositors converted their FDs within a range of 68 per cent to 100 per cent, totaling to a Rs. 1.9 billion into shares.
As agreed with the CB, Entrust in September 2014 also infused a sum of Rs. 2.5 billion into the capital of TSCFC, in the form of Treasury Bills. These t-bills were pledged to the CB which agreed to grant a one-to-one loan of Rs. 2.5 billion from its funds to TSCFC. The infusion was reflected in the Balance Sheet made public by TSCFC in March 2015.
In September 2015, when the t-bills matured after 12 months, Entrust fraudulently took back the sum of Rs. 2.5 billion that was invested in TSCFC without the written consent or approval of the CB. Immediately after that, the MD of Entrust Chanaka Ratwatte mysteriously resigned his position on the board, the appeal said.
In December 2015, Securities and Exchange Commission Chairman Tilak Karunaratne, at a meeting with depositors, informed them that the shares they hold at the TSCFC cannot be listed for sale in the sharemarket as Entrust has been detected as fraudulently embezzling funds invested in their subsidiary. A court case filed regarding this matter is proceeding.
From January 2016 onwards, the Director of the Division for Supervision of Non-banking Financial Institutions (DSNBFL) of the CB Udeni Alawattage, has repeatedly told depositors that they are still finding a strategic investor to take over TSCFC and solve their problems.
| Protest every first Friday of the month The group plans to repeat the protest outside the Central Bank every first Friday of the month under there is an amicable solution to the crisis facing Standard Credit depositors. The next protest is on Friday, June 10, a depositor said. |