The Securities and Exchange Commission (SEC) this week, on the advice of the Attorney General, reversed its own decision made earlier in a 3-year old insider trading case against Harshith Dharmadasa, court and sources close to the SEC said.
When the case came up before the Fort Magistrate’s Court on Tuesday, Senior State Counsel Gehan Kulatunga appearing for the SEC said they were withdrawing charges against Harshith Dharmadasa, son of Deputy Chairman of Nawaloka Hospitals - Jayantha Dharmadasa, who was himself a suspect in the same case.In November 2006, nine persons including Jayantha Dharmadasa and his son were charged by the SEC for committing acts to create a false/misleading appearance of an active share market and the offences of aiding and abetting and conspiracy in the commission of these offences. The charges related to share market transactions in Nawaloka Hospitals.
Subsequently, after several court hearings, the SEC, on May 30, 2008 at the request of Jayantha Dharmadasa, compounded the offences against him on a payment of Rs 3.3 million. Two others also accepted the same terms. However Harshith Dharmadasa and five others suspects didn’t accept the terms and the case proceeded. Thereafter, based on the advice of the AG in February 2009, the SEC board in July ratified a decision made by its legal team that the case against the younger Dharmadasa be compounded with a lesser payment of Rs 1.5 million with a severe reprimand and warning.
However on September 11, the Attorney General Mohan Peiris summoned a meeting with SEC officials and advised them to withdraw the case against Dharmadasa, instead of compounding it. On September 24, the SEC Board reversed its earlier decision and decided to withdraw the case against Mr Dharmadasa. The case against the other five suspects is proceeding, the sources said. |
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