The operating licence of troubled finance company Central Investments and Finance PLC (CIFL) has been cancelled with effect from Monday (March 3), the Central Bank (CB) announced today.
The banking regulator also assured frustrated depositors who have been urging penal action against those responsible for the collapse of the company that legal action will be taken against the “responsible parties for the mismanagement and fraudulent activities of the company”.
Aggrieved depositors, the CB said in a public statement, will be paid compensation under the Sri Lanka Deposit Insurance and Liquidity Support Scheme in accordance with “applicable laws and regulations”. Further, depositors may be able to recover some of their dues in the process of liquidation subject to the priority of claims, the banking regulator said.
The licence was cancelled in November 2017 but time given to the company to raise objections. No activity was permitted during this period.
The CB said the company has been facing severe financial problems over the last four years due to mismanagement and various fraudulent activities taken place in the company. “Depositors of the company have failed to withdraw their money over the last four years. All efforts made to revive the company through different strategies have been failed. The continuity of current status will further detrimental to the interest of depositors and other stake holders of the company,” the CB said explaining the March 5 decision by the CB’s Monetary Board to cancel the licence. -ENDS -
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