Depositors of failed finance companies struggle to survive
Some highly depressed senior citizens over 80 years who have deposited their hard-earned retirement gratuities and lifelong savings in what is called now defunct financial companies are desperately seeking to know what is happening to their deposits still lying in those companies.
File picture of depositors protesting against failed companies
One of these desperate depositors, ailing and over 80-year-old W. K. Ruberu wonders as to what is happening to their deposits in the Finance and Guarantee Company (F&G) and what good these present boards of directors of the defunct finance companies have been doing for the depositors.
Some of them are waiting for more than 10 years. There are two companies in this group which have been treated as defunct, but function under boards.
He indicated that these boards functioned for few years receiving high salaries and other benefits spending lavishly the depositors’ hard-earned money and his view is that the money these officials have been spending could have been sufficient to repay the depositors’ money.
While the functioning of these boards appears to be absolutely futile on the face of any benefits afforded, they continue on the pretext of finding investors to run these defunct finance companies back in business and these attempts have not been materialised.
He indicated that at present what the government and these officials could do is to appoint a powerful body to investigate as to how many boards have been appointed from the time of relinquishing the managements of Mervyn Jayasinghe, Managing Director of both these companies to date and how much money they have collected and how they have been spent – a detailed audited statement of activities they have performed and the present states of these two companies.
This powerful body thus appointed should find out all the misappropriations or frauds, if any, find an investor or other alternatives, to re-establish these companies and publish their findings for the benefit of the depositors.
Meanwhile W. Gunawardene, President, Depositors’ Association of the Central Investment and Finance Ltd (CIFLDA) indicated that they are also struggling to get their deposits back for years while there have been futile promises and assurances by the government and the Central Bank.
He said that including CIFL the other failed finance companies are ETI, Swarnamahal, TKF Finance and The Finance and Standard Credit Finance. The number of depositors and stakeholders would be approximately – CIFL 20,150, ETI 37,586, Swarnamahal 9,623, TKF Finance 35,185, Standard Credit 6,500 and The Finance 147,152.
He stressed the alleged embezzlement of depositors’ funds in the failed finance companies would run to a massive sum of billions of rupees equivalent to the ‘Bond Scam’.
President Gotabaya Rajapaksa has instructed the Central Bank to acquire all the assets and properties of these failed finance companies, and sell to pay back the depositors’ dues in June 2020. Earlier the Central Bank paid initially Rs. 600,000 each to the depositors out of the ‘Liquidity Support Scheme’ with a balance due to be paid to settle the dues.
He said that almost all these struggling depositors are senior citizens are sick and depended on the interest money on their deposits to cover their medical bills. Thus, many of these sick senior citizens have died unable to pay their medical expenses.
Given the fact that senior citizens are more susceptible to COVID-19 this would clearly increase the mortality rate of the country.
He said that without further harassing these already depressed depositors, the authorities can easily pay back the depositors’ money with the money collected by selling the assets and properties of these failed finance companies and added them into the balance Liquidity Support Fund.