Financial Times

Avurudu lessons on governance
Tax fraud at the Inland Revenue Department (IRD) running into billions of rupees; Tourist Board chairman being probed for alleged wrongdoing; Sports Minister under scrutiny over a visa scam; top director at a hospital accused of insider trading, and so on.

What’s happening in Sri Lanka today? We are plagued with corporate crimes, lack of transparency, serious governance issues in the state and the corporate sector. The onus of making things right insofar as the state is concerned rests on the executive, Mr President.

The fraud over VAT refunds has opened a can of worms at the department and raises serious questions as to why this was not discovered before or whether senior officials were in the ‘know’ and chose to hide the facts. The Wise Old Owl, one of our columnists, said last week that this malpractice had been ‘happily’ going on for a long time until it was stopped by the Auditor General.

The Piyawardena couple, the husband-and-wife accountants, accused along with their daughter of insider trading of Nawaloka shares by the Securities & Exchange Commission (SEC) is another case the authorities should ensure is continued to the very end.

The accused have apparently requested the SEC to dismiss the charges without giving any reason to do so. How nice it would be if all criminals write to the authorities asking that their charges be dropped or reduced? It would save time for the judiciary and empty the prisons in no time! Insider dealing is a criminal offence and nothing less. White collar crimes must be viewed like any other offence – the law must be applied equally and forcefully.

Mr Sunil Piyawardena has also been quoted in another newspaper as saying – after the case was filed by the SEC – that he was unaware of the charges. Under SEC laws, notice of action is given to an accused person some weeks before it is filed in the Magistrate’s court and in this case too the Piyawardene’s were given notice, long before it was filed in court.

Again it must be stressed that corporate wrongdoing must be treated like any other crime where accused persons are not informed in advance of a pending action.

Advance notice of an action or a leak in the police department of possible action often results in the culprit fleeing overseas or going into hiding. Take the Pramuka bank fiasco for example where its chairman Rohan Perera flew the coop and subsequently surfaced somewhere in Europe while bank depositors struggled to recover their hard-earnings savings. Some even committed suicide in desperation. Who is to answer for this? In the VAT drama too, two of the accused were nabbed by police just as they prepared to catch a flight.

Another unbelievable drama in the making is the visa fraud at the Sports Ministry. Sports Minister Jeevan Kumaratunga has been implicated according to a CID report submitted to courts. But the minister says he is yet to be questioned by the police, despite the probe being many weeks old. What’s going on? Why hasn’t a statement been recorded so far? Is there political interference or some other agenda? The public has a right to know on this and many other issues.

Then we move to the goings-on at the Tourist Board and the spending spree that the chairman and some officials have been accused of. Anti-bribery officials took away files and documents pertaining to some building contracts while the Treasury pulled the plug on board access to a lucrative cess fund. Lets hope justice prevails here too and officials are brought to book for abusing public funds instead of the usual cover-up.

We tender no apologies for revisiting these issues this week given the need to ensure justice prevails in all these cases. Let’s also hope the culprits don’t choose to enter a plush private hospital on the pretext of some ailment – a routine practice like what former ministers Anuruddha Ratwatte and S. B. Dissanayake did – when confronted with jail or remand.

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