News
Local firms move millions of dollars overseas for phantom imports: Govt.
… lead on Rs 13.2 bn NDB fraud
A sprawling fraud, involving the transfer of millions of dollars overseas under the guise of payments for non-existent imports, has been uncovered by law enforcement and customs authorities, Public Security Minister Ananda Wijepala told Parliament yesterday.
The Minister said investigations by the Central Crimes Investigation Bureau (CCIB), the Financial Crimes Investigation Division (FCID) and Sri Lanka Customs had revealed that large-scale foreign exchange transfers were being routed abroad through telegraphic transfer (TT) systems for goods that were never imported, contributing to significant dollar outflows from the country.
Wijepala said investigators were now working to identify political figures, state officials and banking sector employees, allegedly linked to the racket, adding that preliminary findings indicated the involvement of individuals across multiple institutional levels.
He told the House that provisions under the Prevention of Money Laundering Act, No. 5 of 2006 had earlier classified foreign exchange offences as predicate offences for money laundering,
but amendments under the Foreign Exchange Act, No. 12 of 2017 had removed such provisions, creating loopholes that were subsequently exploited for illicit capital flight. The government, he said, had now moved to amend the relevant legal framework.
The Minister outlined a series of parallel investigations that, he said, pointed to interconnected money laundering and narcotics-linked financial networks operating through shell companies and bank accounts.
In one major breakthrough, the Kelaniya Crime Division police conducting a random search in Peliyagoda discovered Rs. 30 million hidden in a three-wheeler. Two suspects were arrested and, following further interrogations, six more persons were taken into custody. Acting on initial suspicions of narcotics proceeds, the Inspector General of Police referred the case to the CCIB.
Subsequent investigations revealed that the cash had been intended for deposit into accounts linked to Next Gen (Pvt.) Ltd. The company was found to have transferred approximately Rs. 12,890 million abroad in 953 transactions to 256 companies across 26 countries, purportedly for imports that never materialised. The total outflow was estimated at USD 42.7 million.
Investigators further found that the company was controlled by a single director and shareholder and had no verifiable business activity. Authorities also established that funds linked to a recent Rs. 13 billion fraud, at NDB, had been routed into the same accounts.
Police have since frozen two accounts held at the People’s Bank’s Kolonnawa branch and Sampath Bank’s Wellampitiya branch.
In a separate incident, Negombo police arrested four suspects, on 15 February, 2026, in possession of heroin. Interrogations reportedly revealed that proceeds from narcotics sales were being channelled into a bank account, opened at a Divulapitiya branch of a Commercial Bank, allegedly linked to a Sri Lankan national, operating from Dubai.
According to investigators, the network involved deposits from drug dealers into the Divulapitiya account, with funds subsequently transferred to a Commercial Bank, Pettah branch account, belonging to AY Investments. The account reportedly held Rs. 2.2 billion after being opened on 09 September, 2024.
Authorities said withdrawals were made via cheques every two to three days and re-deposited into another AY Investments account at Union Bank’s Pettah branch. The company maintained four accounts at the branch, collectively holding around Rs. 13 billion.
Between 03 October, 2025, and 04 March, 2026, investigators said approximately USD 43 million had been transferred abroad from these accounts under the pretext of importing hardware, bathroom fittings and gold jewellery, none of which were brought into the country. A further Rs. 53.6 million balance has since been frozen as suspected proceeds of crime.
Investigators have also uncovered a wider pattern in which company directors allegedly establish import-export entities, operate them for short periods of around six months, and then dissolve or replace them with new entities. Customs officials have reportedly identified 105 local companies operating through 227 accounts in 13 banks, with funds transferred abroad in 26,108 instances between 01 January, 2023, and 30 September, 2025, for non-imported goods.
The racket is believed to involve 55 company directors and secretaries who allegedly function as facilitators in setting up and rotating such entities.
Officials noted that under existing procedures, banks are required to inform Sri Lanka Customs and the Central Bank within 180 days of TT transactions related to imports. Where goods are not received, Customs is expected to notify the Import and Export Controller and the Central Bank. However, investigators said these reporting mechanisms had not been properly followed, enabling systemic abuse.
Following the exposure of the racket, President Anura Kumara Dissanayake has summoned heads of relevant institutions for two high-level meetings, directing immediate action and comprehensive investigations.
Minister Wijepala said further inquiries were ongoing and assured that strict legal action would be taken against all perpetrators regardless of rank or position in the coming days.
By Saman Indrajith
News
US-assisted ‘Ice’ detection: NPC to examine IGP’s move to transfer drug-busting team
Senior DIG among those slated for transfer
By Shamindra Ferdinando
The National Police Commission (NPC) is expected to take up Police Headquarters recommendation to transfer a group of police officers responsible for a major ‘Ice’ bust at the Colombo port recently.
NPC sources told The Island that recommendation in respect of transfers was received last week. Sources said that though the NPC was scheduled to meet today (01), whether IGP Priyantha Weerasooriya’s recommendation would be discussed and decided today was not known.
Members of the NPC are retired High Court Judge Lalith Ekanayake (Chairman), K. Karunaharan, Dilshan Kapila Jayasuriya, A.A.M. Illiyas and Jayantha Jayasinghe
The IGP directed the Special Investigation Unit (SIU) to probe those who carried out the 31 August, 2026 raid that resulted in the detection of 463 kgs of ‘Ice’ concealed in a container that arrived from Pakistan.
The US Embassy declined to comment on the probe though it declared that the largest ever narcotics detection was made on intelligence made available by the US Drug Enforcement Administration (DEA).
The officers investigated for what an authoritative Headquarters source called shortcomings and lapses on the part of the raiding party, belonged to the Central Crime Investigation Bureau (CCIB). Senior DIG Ranmal Kodituwakku who, on behalf of the CCIB, received information directly from the DEA, is among those Police Headquarters wanted to transfer.
CCIB carried out the raid after having obtained a search order from the Aluthgama Magistrate court. Among the suspects taken in this connection are three Pakistani nationals.
News
2027 Budget to be held from 12 Nov. to 14 Dec.
* First Reading of the Budget on 7 October
The Committee on Parliamentary Business has decided that the Second Reading of the Appropriation Bill for the year 2027 (Budget Speech/presentation of Budget proposals) will take place on 12 November, followed by the Second Reading debate from 13 November to 14 December.
Secretary General of Parliament Kushani Rohanadeera said this had been decided at a meeting of the Committee on Parliamentary Business held recently under the chairmanship of Speaker Dr. Jagath Wickramaratne.
Accordingly, the Appropriation Bill was scheduled to be presented to Parliament for its First Reading on 7 October, the Secretary General said.
It was also decided that the Second Reading of the Appropriation Bill (Budget Speech) would be delivered by President Anura Kumara Dissanayake, in his capacity as the Minister in charge of Finance, on Thursday, 12 November, 2026.
Thereafter, the Second Reading debate will be held for seven days, from 13 November to 20 November. Accordingly, the vote on the Second Reading will be held at 6.00 pm on 20 November.
Thereafter, the Committee Stage debate will be held for 19 days, from 21 November to 14 December , with the vote on the Third Reading of the Budget scheduled for 6.00 pm on 14 December.
During this period, the Budget debate will be held every day, including Saturdays, except on public holidays and Sundays. Parliament is scheduled to meet at 9.30 am on each of these days.
From 9.30 am to 10.00 am each day, time will be allocated for the Parliamentary business specified under Standing Order 22(1) to (6). Thereafter, five Questions for Oral Answers will be taken up from 10.00 am to 10.30 am, followed by one question under Standing Order 27(2) from 10.30 am to 11.00 am.
Accordingly, the debate is scheduled to be held from 11.00 am to 6.00 pm on all days, except the two days on which votes are scheduled to be taken, Motions at the Adjournment Time will be taken up for debate from 6.00 pm to 6.30 pm, based on a 50:50 time allocation between the Government and the Opposition, the Secretary General stated.
It was also approved that during the Second Reading debate, 60% of the debate time will be allocated to the Government and 40% to the Opposition, while during the Committee Stage debate, 40% will be allocated to the Government and 60% to the Opposition.
Furthermore, if a division is called for on an Expenditure Head, relating to a Ministry, the relevant vote will be held at 6.00 pm at the conclusion of the proceedings on the respective day.
News
CB Governor confident over timely disbursement of next IMF tranche; hands post-2027 programme decisions to govt.
By Sanath Nanayakkare
Central Bank Governor Dr. Nandalal Weerasinghe addressed queries on the nation’s IMF bailout programme yesterday and indicated that Sri Lanka expects to reach a Staff-Level Agreement with the Fund shortly, clearing the path for the next tranche of funding under the $3 billion EFF arrangement before the end of the year.
Answering questions on Sri Lanka’s economic path, after the current programme expires in March 2027, Dr. Weerasinghe clarified that seeking a follow-up IMF arrangement was entirely a policy decision for the government rather than the Central Bank, maintaining the institutional boundary between Central Bank operations and political decision-making.
The Governor remained firm in his projection that the national economy would expand by around 4 percent throughout 2026, demonstrating economic resilience, even amid external volatilities, such as high oil prices.
Dr. Weerasinghe expressed confidence in the domestic economy’s underlying momentum. While international financial institutions and multilateral agencies had pegged Sri Lanka’s growth prospects at more conservative levels, typically around 3.0 to 3.5 percent, he emphasised that CBSL’s projections are grounded in continuous analysis of real-time indicators.
“When you compare with several other agencies, their growth projections hover around 3 to 3.5 percent. However, the economy is already growing at around 4 percent. In our projections, the economy will maintain this growth rate of around 4 percent throughout the year,” Governor Weerasinghe said.
He noted that despite mid-year quarter adjustments due to volatile oil prices, real economic indicators, including steady credit expansion across the commercial banking sector and sustained industrial and service activity, indicate that the growth trajectory remains firmly on track above the 4 percent benchmark.
Reiterating the Central Bank’s primary mandate, Dr. Weerasinghe noted that monetary policy actions remained focused on anchoring inflation and curtailing excess demand to prevent runaway price spikes.
On inflation targeting, the Governor mentioned that CBSL had submitted a technical recommendation to the Ministry of Finance to maintain an inflation target of 5 percent (+ or – 2 percent band) over the next three-year horizon.
Responding to inquiries on differing target forecasts announced by external agencies such as the IMF, Dr. Weerasinghe underscored that the Central Bank’s recommendations stem strictly from domestic technical and empirical evaluations.
“Our recommendation is based on pure technical and empirical analysis considering the country’s specific situation. We have recommended maintaining a 5 percent target for the next three years, and the government has accepted this recommendation,” he added.
Regarding foreign exchange management, the Governor noted that the Central Bank continues its active market intervention strategy aimed at smoothing out undue exchange rate volatility rather than resisting natural market trends.
Dr. Weerasinghe concluded that while the short-to-medium-term outlook remained assured, the combination of a steady 4 percent growth target and proactive fiscal measures would firmly anchor macroeconomic stability through 2026 and beyond.
-
Editorial5 days agoBirth of a bad law
-
Features6 days agoBeyond traditional jobs: Why Sri Lanka needs to facilitate the gig economy
-
News3 days agoPolice remove Thileepan statue in Jaffna
-
Latest News6 days agoKusal, Wellalage star as Sri Lanka defend 322 in Headingley thriller
-
News5 days agoTIN mandatory for key transactions from Nov. 1
-
Features3 days agoThe 22nd Amendment, constitutional recovery and illiberal slippage
-
Features3 days agoOf foreigners as CEOs of Lankan ventures
-
News3 days agoSajith rejects Jt. Opp. protest sabotage claim; SJB TU chief demands remedial action
