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SriLankan GSA in Russia operated thro’ Lankan embassy: Witness
View(s):When SriLankan Airlines decided on a General Sales Agent (GSA) in Russia in 2011, the then Sri Lanka’s Ambassador to Russia, Udayanga Weeratunga interfered in the process by introducing an unregistered company which had business affiliations with him, and all the business transactions were processed through the Lankan Embassy in Moscow, it was revealed at the Commission of Inquiry Investigating alleged irregularities at SriLankan, SriLankan Catering and Mihin Lanka this week.
SriLankan ‘s e-Business Operations Manager (Rtd) Ajith Wasantha Weerasekara, who was tasked to open the GSA office in Russia, testifying before the commission said it was an unusual experience in his decades-long career, where a Sri Lankan embassy was involved closely in setting up the GSA office in a foreign country.
He said that, as a senior representative of an independent institution such as SriLankan, he found it difficult to effectively carry out his duties, as he had to report and brief the then Ambassador Weeratunga, on every decision that needed to be taken on the GSA operations.
The prosecution led by State Counsel Chathura Gunathilaka and assisted by Sajith Bandara, asked Mr. Weerasekera as to who authorised him to set up the GSA office in Russia, when prior cost analysis studies indicated that opening a direct airline route to Moscow was not profitable. After three years from the opening of the air route, it had failed to generate adequate revenue as expected by the management.
Mr Weerasekara told the commission that he was not aware of who took the administrative decision of setting up a GSA office in Moscow, but he was asked by the then Chairman Nishantha Wickremesinghe, the Chief Financial Officer T. Jayaseelan and the then Regional Country Manager Lal Perera, to implement the decision in a short period of time, as SriLankan was scheduled to begin direct flights to Moscow in early December 2011.
A company called Sri Lankan Liabilities Ltd, which reportedly had business affiliations with the then Ambassador Weeratunga, was recommended by him, and all the administrative and business operations were conducted from the Lankan embassy in Moscow. An individual named Dilan Ariyawansa was appointed as Chairman of the company but, subsequently, he was replaced by Gamini Abeywickrema. Though witness acknowledged the business affiliations with the said company, Counsel Gunathilaka argued that the preliminary evidence before the commission suggests the company was founded by a former Lankan Ambassador to Russia.
Mr Weerasekara said that, when financial transactions were finalised through the Accounts Dept of the Sri Lankan Embassy in Russia, he came to know that Sri Lankan Liabilities Ltd was not a registered company. The commission was informed that a Russian national named Anna Korokova, one time interpreter at the Lankan Embassy in Moscow, was handling the GSA’s administrative affairs.
Following a directive issued by the commission to formulate a comprehensive cost analysis into the expenses and revenue of GSAs in six countries, SriLankan Revenue Accounting Senior Manager Upeka Awanthi Jayasekara submitted the relevant documents this week.
During her testimony on Thursday, she said that Rs 15 million was spent for promotional purposes, ahead of the opening of the new GSA office in Moscow. Another huge amount of US$ 184,700 was paid to the Lankan Embassy in Moscow for accommodation, board and promotional initiatives.
An A340 charter flight was hired for Rs 25 million (US$ 235,000) by SriLankan, on a directive from the Presidential Secretariat, to fly in guests and a dance troupe from Sri Lanka to Moscow. Only 32 persons, including the then Chairman Wickremesinghe, flew from Colombo to Moscow in the 280-seat aircraft.
A second aircraft was also hired for Rs 17.2 million, with no reasons given by the SriLankan management for its purpose. The CoI comprises retired Supreme Court Justice Anil Gooneratne (Chairman), Court of Appeal Judge Gamini Rohan Amarasekara, retirewd High Court Judge Piyasena Ranasinghe, retired Deputy Auditor General Don Anthony Harold and Sri Lanka Accounting & Auditing Standards Monitoring Board Director General Wasantha Jayaseeli Kapugama.
The hearings will continue tomorrow at 1.30 pm.