Central Bank seals CIFL premises in Colombo

The Central Bank (CB) on Monday at around 12 noon sealed the premises of the Central Investment and Finance Ltd (CIFL) in Colombo following a decision to cancel the licence of the troubled company.
Witnesses said a group of 25 high officials of the Central Bank including security staff had ordered all the officials including those from People’s Leasing, the Managing Agents and the CIFL staff to leave the premises and padlocked the main entrance preventing anybody entering.
W. Gunawardene, President, CIFL Depositors Association said the officials included W. Ranaweera, Acting Director, Non-Banking Supervision Department accompanied by Kamal Dissanayake, Assistant Director, Non-Banking and Ms. Chamani Jayasinghe, Deputy Director.
Earlier in a statement, the Central Bank said its Monetary Board has decided to cancel the licence issued to CIFL with effect from Monday (March 5) barring it from engaging in any finance business. The banking regulator also cancelled CIFL’s Certificate of Registration of CIFL as a Registered Finance Leasing Establishment under the provisions of the Finance Leasing Act No. 56 of 2000 (FLA) with immediate effect.
Mr. Gunawardene pointed out that the Central Bank is clearly violating its mandate by taking steps to liquidate the company as CIFL has filed legal action against violating the rights of the depositors and redress is sought in the Supreme Court and this case will be called on March 15.  
Expressing the frustration of the depositors, Mr. Gunawardene said the action to liquidate the CIFL stands as a clear warning signal to other failed financial institutions some of which are carrying on their struggles for more than 10 to 12 years. – (Quintus) -