Rogue finance companies face legal action for fraud
View(s):Rogue finance companies are now being brought under intensified surveillance of the Central Bank (CB) which is taking necessary legal action as these firms have become a severe threat to the current financial system affected by the second wave of COVID-19.
The CB will be taking measures to broaden public awareness on the consequences of engaging in unauthorized financial activities by errant finance companies. It has intensified surveillance in detecting unauthorized finance businesses and deposit-taking while seeking public support to take appropriate action against such errant financial institutions.
One example is that all operations of Eyon Lanka Investment and Film Production International Company (Pvt) Ltd have been frozen by the CB as this unauthorized finance company has carried out illicit finance business and deposit mobilization, with the Colombo High Court extending the ‘freeze’ order until January 15, 2021. Further, a report was sent to the Attorney General’s Department on November 2 requesting to institute criminal proceedings against the rogue finance company.
Over 9000 depositors including retired members of security forces have become destitute due to the sudden collapse of the company and the freezing of its operations, several disgruntled depositors said. (BS)