Special Assignment

6th September 1998

Duped by Zimbabwe

Mystery of the missing mortars: story todate

Duped by Zimbabwe

Only a detailed probe covering several world capitals will seem to provide the answers for the mystery of the missing mortars

The Zimbabwe Government owned Zimbabwe Defence Industries (ZDI), which contracted to supply 32,400 rounds of mortar bombs as part of a multi million rupee deal, has duped the Sri Lanka Army, investigations by The Sunday Times has revealed.

The ship on which the goods were to arrive - a Liberian registered "MV Stillus Limmasul" - has turned out to be non existent. The Lloyd's Register of Shipping does not list the name or the purported owning company "Stillus Shipping Limited" with an address in the City of Limmasul, in Cyprus.

The Sunday Times has found that the Liner Bill of Lading (see copy on this page) is a forgery. Investigations have revealed that there is no Stillus Shipping Company by the name given in the Liner Bill of Lading.

It bears the address "STILLUS SHIPPING LTD. , (International Maritime Transport - Limassol, Cyprus), 111. SPYROU ARAQUOZOU St. Limmasol, Cyprus. " It does not, carry any telephone number in Cyprus. Instead the only numbers given are a fax and telex number of a so called "@ Special Transport Branch - London. " Both the fax and the telex do not function.

The Sunday Times has found that such a shipping company did not exist. Another declaration, which has now turned out to be fraudulent, is the reference to the port of shipment. The Liner Bill of Lading (issued by the ship owner or his agent, in this instance the ZDI), which was received by the Bank of Ceylon was self-contradictory. It has been issued in the Croatian port of Rijeka whilst the shipment was described as Beira in Mozambique. This has escaped the attention of both the Bank of Ceylon and the Sri Lanka Army.

Documents in possession of The Sunday Times show that three ZDI officials - Chief Executive Tshinga Dube, Company Secretary, Douglas Mrewa and Financial Manager, M. Fumhai - cleverly used the Zimbabwean State organisation as a front.

Whilst giving Sri Lankan authorities various reasons for not being able to execute the order, the ZDI officials had been involved in a secret deal with an Israeli arms dealer to obtain the mortars from elsewhere.

Col. Dube, the prime mover, worked this with Sapir Ben Tsouk, head of the Israeli arms firm, LBG industries.

Douglas Mrewa, the Company Secretary, lied periodically to the Sri Lankan Army by saying that "Stillus Limmasul" was on its way to Colombo. When the fate of the shipment was not known, he flew to Colombo for a meeting with Defence Secretary Chandrananda de Silva and Army Commander, Lt. Gen. Rohan de S. Daluwatte. There too he repeated the excuses he had given in faxes he sent earlier.

The Sunday Times is in possession of evidence that Financial Manager, Fumhai, flew from Zimbabwe to Israel to collect the bogus Liner Bill of Lading. Later , he flew to South Korea to hand it over to Kolon International Corporation to claim early payment.

The Sunday Times has learnt that all this while, ZDI officials with the help of Israeli arms dealer, Mr. Tsouk arranged to obtain the mortar cargo at a ridiculously cheaper rate from a source in Croatia. It was to be shipped from the Port of Rijeka.

But, the LTTE, which had been monitoring the developments, seized the cargo fronting one of its own vessels. How did they do it? How did they get to know of the deal? How did they plan and execute the operation? Sri Lankan intelligence have established that the mortars were not only seized by the LTTE but also the fact that they were and are being used liberally in the ongoing "Operation Jaya Sikurui". Will the authorities ever get to know the answers?

With local investigations part complete, inquiries abroad have become a difficult task for the CID.

The Sunday Times has learnt that high pressure moves are afoot by interested groups to prevent a fuller investigation. Soon after I made some inquiries to verify details about this matter, I received two anonymous calls warning me not to chase up the story. One caller said "keep off or you will realise your mistake". The other was simply intimidatory. "We have a few mortars for you too", the caller said.

The extent to which the Zimbabwe government's name was used is reflected in a fax Mr. Mrewa sent to Sri Lanka Army on June 25, l997.

Titled: "SUPPLY OF SECURITY EQUIPMENT TO SRI LANKA ARMY - 85% AT SIGHT PAYMENT FOR FIRST SEA SHIPMENT", among other matters, Mr. Mrewa said:

"We are also aware that certain unscrupulous parties are spreading rumours to the effect that no shipment has been effected by ZDI and creating doubts in your minds. This is of no truth, we are the Government of Zimbabwe and will honour all contracts to the last letter and would at no instance be involved in any unlawful or bogus activities and discredit the people and the Government of Zimbabwe. Therefore we strongly request you to take keen interest in this matter and instruct BOC, Colombo to give necessary approvals to BTC New York immediately".

It was only after The Sunday Times revelations that the mystery behind the missing mortars began to unravel.

Mr. Mylvaganam, who was by then dealing with Kolon International Corporation, a South Korean firm and Zimbabwe Defence Industries (ZDI), flew to Singapore after reading The Sunday Times' first report on July 20, 1997. This was because there were no direct dial telephone facilities between Zimbabwe ad Sri Lanka. He put pressure on the ZDI officials.

On July 2l, 1997, Army Headquarters, sent out an urgent fax to ZDI in Harare. The next day (July 22), ZDI Company Secretary, Mr. Mrewa replied.

This is what the fax said: "We refer to your fax of 21st July l997 and provide you with some of the answers we have received thus far.

a. Name of vessel - STILLUS LIMASOL also known as STIMILLIUS LIMASOL VICTORIA

b. Vessel flag - Liberia

c. Vessel registration - Liberia

(Note: the Liner Bill of Lading gives the Country of Registration as Cyprus)

d. Port of origin - Croatia

e. As regards the vessel route, we are still trying to obtain the complete route.

f. The last time the vessel was contacted by our counterpart was in Port of Elizabeth heading for Madagascar.

g. As far as we know, the vessel had the 8l mm cargo only. We shall revert back to you as soon as possible as soon as we obtain additional information. We are disturbed with the news that two other vessels were hijacked within the same week. We have also received threats from the terrorists. We are currently loading the rest of the consignment with a very near departure date but we are not sure whether we should risk sending another vessel in view of the insecurity. We are also aware that the L/C terms have been exceeded. Please confirm to us whether we should go ahead. Best regards

D. Mrewa Company Secretary"

Giving bogus shipping details has not been the only ruse the ZDI officials adopted to buy time whilst they went looking for mortars. They made the Sri Lanka Army believe that the mortars were in fact being manufactured in Harare and that the cargo was being shipped from the Port of Beira in Mozambique. That is not all. They even forwarded a claim from Retlaw Freight (Pvt) Ltd. (suspected to be a non existent firm) claiming U. S. $ 150,000 for " FREIGHT CHARGES FOR YOUR CONSIGNMENT OF 12 X 6 METRE CONTAINERS SECURITY EQUIPMENT EX BEIRA TO COLOMBO: SEAFREIGHT BEIRA TO COLOMBO= U. S. $ 150,000"

In a letter to Army Headquarters dated 11th April, l997, Mr. Mrewa said: "SUPPLY OF SECURITY EQUIPMENT TO THE SRI LANKA ARMY ON A GOVERNMENT TO GOVERNMENT BASIS UNDER L/C NO M/G/L/96/52785 DATED 21ST NOVEMBER 1996

"We are pleased to inform you that the Government of Mozambique has now given us permission to transport above cargo across their territory to Port Beira for onward shipment to Colombo. However, the permission has been granted to transport this cargo only during the month of May 1997 {enclosed herewith is a copy of the letter from Mozambique authorities}. Therefore you are kindly requested to extend the last date allowed for shipment in the above L/C to the 25th of May l997 and the negotiation period & expiry date of L/C to the 15th of June l997.

"Your kind and immediate co-operation in this regard would enable us commence sourcing of vessel and successfully complete delivering of consignment within the month of May l997".

The Sunday Times is in possession of several other documents which clearly show the dubious role of the ZDI officials. Was there any Sri Lankan collusion in this? Did the LTTE learn the initial details of the deal from Sri Lanka? Why was the shipments from ZDI not monitored closely ? Why was there a blanket of secrecy and attempts to deny the military cargo has been lost ?

Only a detailed probe covering several world capitals will provide the answer.

See Situation Report on Page 9 on how the deal began

Mystery of the missing mortars: story todate

Since July 20, last year, The Sunday Times has been exclusively revealing details of the mystery behind the 32,400 rounds of 81 mm mortars, ordered by the Sri Lanka Army from the State-owned Zimbabwe Defence Industries (ZDI) and later seized by the LTTE.

It all began after the United States Embassy in Colombo received an undated fax message in early July last year, purportedly from the LTTE.

This is what the message said:

WARNING WARNING WARNING

NOTICE AND WARNING

We, the Tamil Tigers, inform you by the present that on 11 July 1997 we have hijacked a vessel carrying arms, sailing under Liberian flag. The name of the vessel "Stillus Victoria" . On the deck of the vessel there were 12 containers containing 32,400 mortar bombs 81 mm, destined for Colombo, Sri-Lanka, Ministry of Defence. We know that the manufacturer and the supplier of the mortar bombs is Zimbabwe Defence Industry from Harare, Zimbabwe. We also know that the deal was executed by Col. Dube, D.G. of Zimbabwe Defence Industry. The cargo was confiscated by us and the vessel's crew was released unharmed. We make known and warn that we will take action against all persons participating in the supply of military equipment used against the legitimate rights of the Tamil people and we will severely punish those concerned.

LTTE

WARNING WARNING WARNING

Periodic exposures in The Sunday Times Situation Report prompted Government denials and a news blackout. Deputy Defence Minister Anuruddha Ratwatte declared: "We have been having dealings with Zimbabwe for arms and all we have ordered have reached here."

Similarly, LTTE's Anton Raja told Chandana Keerthi Bandara of BBC's London based Sinhala service, Sandheshaya, on July 21, last year, his organisation "knew nothing of it."

When more exposures appeared, the LTTE's "International Secretariat" in London issued a formal statement on October 4, last year. It said "The LTTE categorically denies any involvement whatsoever in the acquisition of a shipload of mortar bombs bound for the Sri Lankan military, which is alleged to have gone missing between the Indian Ocean island of Madagascar and Sri Lanka.

This statement which came four months after the purported LTTE fax arrived claimed "the episode has also been exploited to tarnish the international image of the LTTE, in particular to try and associate the LTTE with acts of international piracy."

If both sides, the government and the LTTE, were attempting a cover up, there was more. Sections of the media gave prominence to claims that the missing shipment had in fact arrived. Others claimed the lost cargo had been made good by the Zimbabwe Defence Industries. Were these reports based on leaks by interested parties who wanted to hush up the scandal?

The Sunday Times continued to investigate the mystery and exposed the facts, then unknown, about the mortar deal, how the consignment went missing and the wheeler dealing that has been going on. So much so, the Government decided in January, this year, to order the CID to conduct a full inquiry.

On January 3, 1998, Superintendent of Police, A.N. Sisira Mendis, invoked provisions -Section 6 ( i ) - of the Prevention of Terrorism Act to constitute a probe team. Under his directions, it was made up of the following CID personnel - Inspector R.K. Waidyasekera, Inspector R. Linton, Inspector Ranjith Silva, Inspector R.K. Fernando, Sub Inspector Indrajith Fernando, Sub Inspector H. Udugama and Reserve Sub Inspector Induka Silva.

But a day earlier, even before the team was formed, SP Mendis and SI Indrajith Fernando recorded the statement of 36-year-old arms dealer, Nissanka Samaratunga, Managing Director of General Trading Company (GTC). Among other things, the firm had supplied Mi 17 helicopters, combat boots, ballistic helmets and communications equipment spares.

Mr. Samaratunga had been assisted in his business activities by his school time buddy, Rajkumar Mylvaganam. Since Grade III days at St. Joseph's College, they have been close friends. According to Mr. Samaratunga, Mr. Mylvaganam joined his company (GTC) in 1992, firstly as Export Manager and later became General Manager of the Projects Division that handled all supplies to the armed forces and the Police.

On January 3, this year, CID detectives arrested Raj Mylvaganam. Since then, he is being held under a detention order under the Prevention of Terrorism Act. His continued detention is now the subject of a Fundamental Rights application before the Supreme Court.

Hard on the heels of Mr. Mylvaganam's arrest and detention, CID detectives took in for questioning Janaka Edirisinghe, a businessman and a member of a leading social club. It turned out that he was influence peddling to secure the deal for GTC and had been assured a commission of two per cent as reward.

As investigations got into full swing locally, the former Deputy Inspector General of Police in charge of the CID, T.V. Sumanasekera, shot off faxes to Interpol offices in Harare, the capital of Zimbabwe and Maputo, the capital of Mozambique. He wrote in his capacity as head of the National Central Bureau (NCB).

Apart from its headquarters in Lyons (Central Station - CS) France, Interpol operates through National Central Bureaux (NCBs) in each of its 158 member states, manned by personnel from the local police force but devoted solely to the organisation's work.

In identical letters faxed to Maputo and Harare on January 29, this year, Mr. Sumanasekera said:

"29. 01. 98 -

"CID/Sri Lanka is conducting investigations into the procurement of weaponry by the Government of Sri Lanka from Zimbabwe Defence Industry in Harare, Zimbabwe.

" 02. Inquiries conducted at this end had revealed that MV STILIUS LIMASOL which had left Port Beira in Mozambique on 24.05.97 with a consignment of mortar bombs had not reached Sri Lanka as scheduled and upto date, the whereabouts of this vessel are not known. It further disclosed that the above mentioned consignment of mortars is a part of weaponry ordered by the Government of Sri Lanka on a Letter of Credit (LC) opened with Kolon International Corporation, Korea who acted as the beneficiary of this transaction between the Government of Sri Lanka and Zimbabwe Defence Industry. The person who had figured in this transaction in Sri Lanka is in our custody. The relevant documents too had been taken charge for investigation. Considering the present security situation in Sri Lanka, it is necessary to conduct in-depth inquiries to ascertain the details connected to the above shipment, in Mozambique. (Zimbabwe in the case of Interpol Harare). In this connection, it is proposed to send a team of investigators to conduct inquiries with your assistance. It is appreciated if you could intimate us whether your assistance could be rendered to get this investigation successfully completed.

Regards - Head of N.C.B. Colombo "

Later on February l3, l998, Mr Sumanasekera wrote again to Interpol (Maputo). He said:

"To: Interpol (Maputo) Our Ref: E3/C6/98/CM Date: l3/02/98. DISAPPEARANCE OF A VESSEL WITH A CONSIGNMENT OF MORTAR BOMBS FROM ZIMBABWE DEFENCE INDUSTRIES TO SRI LANKA ARMY

"This refers to the Fax message dated 29.0l.98 on the above noted subject by N.C.B. Colombo. It is necessary to ascertain the following pertaining to this inquiry. Whether M.V. STILLIUS LIMASOL was berthed at Port Beira on or before 24.05.97. If so, the name of the Captain and the particulars of the crew and under which flag it came to be berthed. The description of the cargo on board this vessel. Whether it was a charter vessel. If so, by whom. What was the Port of origin. What was the last destination of this vessel.

"It is also appreciated if you could furnish to us the following:- The authenticity of the document annexed herewith. Is it a document originated by the Govt. of Mozambique or is it a counterfeit document. If it is genuine, could a copy of the approved document be sent to us. Your early reply in this regard is greatly appreciated.

Head of N.C.B. Sri Lanka T.V. Sumanasekera Deputy Inspector General of Police."

After The Sunday Times revelations that the shipment of mortars did not originate from the Mozambican port of Beira, it transpired that the Zimbabwean authorities had claimed even freight for loading the cargo from that port. An invoice from a freight forwarding company had been submitted (see copy on this page).

In order to clarify this matter, Mr. Sumanasekera wrote to Interpol, Harare, on March, 19, 1998. He said:

"Interpol Harare

DISAPPEARANCE OF A VESSEL WITH A CONSIGNMENT OF MORTARS FROM THE ZIMBABWE DEFENCE INDUSTRIES TO THE SRI LANKA ARMY

This refers to my previous fax to you dated 29.01.97 concerning the above noted subject. It has now become necessary to ascertain the following information with regard to the ongoing investigation at this end: Whether a Freight Forwarding Company named "RETLAW FREIGHT (PVT) LTD.' at Delmatia House, 69, Speke Avenue, Harare and CY 2l82 Causeway, Harare, Zimbabwe is in existence. If so, this company effected the inland transportation of Military Hardware from Harare to Beira Port in Mozambique. A reply at your earliest convenience will be greatly appreciated.

Regards, Head of NCB Sri Lanka T.V. Sumanasekera Deputy Inspector General of Police "

On March 26, l998, the National Central Bureau at the CID, Interpol Harare replied. Their response was only about the Retlaw Freight (Pvt) Ltd.

This is what P.W.J. Banda, Assistant Commissioner, head of NCB, Interpol Harare said:

'SUBJECT : DISAPPEARANCE OF A VESSEL WITH A CONSIGNMENT OF MORTARS FROM THE ZIMBABWE DEFENCE INDUSTRIES TO THE SRI LANKAN ARMY:

'Your message of the 18th March 1998 in connection with the above matter has been received by this office and is receiving attention. In order to ease our investigations, you are kindly and urgently requested to send by fax all documents concerning Retlaw Freight Pvt Ltd. which you are in possession of.

'Best regards'

On April l5, M.M. Musaka, Officer in charge of Interpol Harare, sent another message to Mr. Sumanasekera. It said:

'SUBJECT: DISAPPEARANCE OF A VESSEL WITH A CONSIGNMENT OF MORTARS FROM THE ZIMBABWE DEFENCE INDUSTRIES TO THE SRI LANKAN ARMY

'My message of the 26th March 1998 to you in connection with above matter refers. May you advise position or when can we expect a reply. Kind regards'

Mr Sumanasekera replied to Interpol Harare on April 29, l998. He said:

To: INTERPOL/HARARE

Out Ref: C 06/98/CM

Yr.Ref:IP/37(634-98)

29 April 1998

DISAPPEARANCE OF A VESSEL WITH A CONSIGNMENT OF MORTAR BOMBS FROM ZIMBABWE DEFENSE INDUSTRIES TO SRI LANKA ARMY

This refers to my previous faxes to you dated 29.01.98 and 19.03.98 and your reply faxes dates 26.03.98 and 15.04.98 on the above noted subject. In respect to the above inquiry , it is necessary to show the documents you have requested for in your fax dated 26.03.98 and interview Mr.D.MREWA, company secretary and Col. T.J.Dube, General Manager of Zimbabwe Defense Industries to obtain more details about the above mentioned shipment.

'It is therefore intend to send two officers from the CID Sri Lanka to Zimbabwe for the above purpose around early part of June as it has become necessary to expeditiously finalise matters relating to this investigation at this end.

'I shall be grateful, if you could inform me whether you could render assistance to the two Sri Lankan CID officers during their stay in your country to attend the matters at para 2 above. Your kind co-operation in this regard is greatly appreciated.

Head of N.C.B. Sri Lanka

T.V. Sumanasekera

Deputy Inspector General of Police

For strange and unknown reason, Interpol Harare, was tardy in their response. Even last week , the new DIG , CID Punya de Silva was making contact with Harare eight months after the investigation had begun in Colombo, the CID was facing difficulties in probing the overseas links.

It is in this backdrop that SP Sisira Mendis, had a meeting with Additional Solicitor General C.R. de Silva, a highly respected official in the Attorney General's Department. Also associated with the discussion was S.Samaranayake, State Counsel.

On May 4, 1998 MR. De Silva wrote to Mr. Sumanasekera. The full text of the letter appeared in the Sunday Times of August 23. Mr de. Silva made some strong observation. Among them:

"This was the transaction between two Governments and the primary responsibly for its proper conduct lay with the relevant officers of the Sri Lanka Amy. Rajkumar Mylvaganam was merely an agent of the General Trading Company which had done the initial spade work before the contract was made by the two Governments. Mylvaganam had no status in the affair and he appears to have been motivated by the prospects of financial gain by way of commission if the deal was successfully concluded. As a matter of fact however Mylvaganam appears to have been the only Sri Lankan who took any Interest in the matter when it became increasingly apparent by June and July 1997 that the shipment had been sabotaged. A perusal of the scanty correspondence by the SLA during this period reveals the degree of apathy and inaction shown by the SLA which ought to have been more concerned with the fate of the shipment than individuals driven by private gain.

It also appears that Col. Dube and the company Secretary Mrewa had used the ZID, the concern which they represented, as a convenient cover for a secret transaction which involved the Israeli firm LGB Military Supplies. Important details with regard to the manner in which the shipment was to be effected as well as the part that the LGB Military Supplies was to play in it were kept hidden from the SLA until the cargo disappeared without a trace. It is difficult to believe that ZDI would have entrusted the valuable cargo to LGB Military Supplies simply as a matter of "trust" as Col. Dube has subsequently stated.

The misrepresentation and suppression of material facts by persons who acted on behalf of the ZID in this transaction is something which should be taken serious note of. It is my view that the Government of Sri Lanka should agitate this mater at government level as it involves a fraudulent breach of contract in a transaction which was entered into at Governmental level. The Government of Zimbabwe would at least guarantee its full co-operation for an investigation to be carried out by Sri Lankan Officers."

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