News
Treasury loses USD 18 mn as minister blocks CCD probe into generator fraud
by Ifham Nizam and Prabhath Withana
An investigation by the Colombo Crimes Division (CCD) into a complaint of fraud, which caused a loss of over USD 18 million to the government coffers, has been stalled by a minister, according to police sources.
The CCD commenced the investigation, several weeks ago, following a complaint against a Singaporean, of Sri Lankan origin, and a Sri Lankan, for using forged documents to cheat a Sri Lankan company out of Rs 35 million.
Investigators uncovered a customs fraud, amounting to USD 18 million using a Power Purchasing Agreement (PPA) between the Ceylon Electricity Board (CEB) and a Hongkong-based company. The Customs Department’s Compliance and Facilitation Division commenced a separate investigation.
The Customs investigation found that the suspects had deprived Sri Lanka of USD 18 million by using the PPA, which had been cancelled by the CEB. “As per the PPA, the V Power Holdings could import to Sri Lanka power generators, duty free, to supply 34 MW to the national gri, for a six-month period. As per the PPA, after six months the company is required to re-ship those generators and is also requested pay a 10 percent tax on revenue from the generators. That tax could have been around one million USD. They brought down 350 generators. The duty for the generators would have been around 14 million USD. The company obtained a duty waiver to the tune of around three million USD. However, the PPA had been cancelled by that time by the CEB because V Power Holdings failed to deliver 34 MW, within the stipulated one-month period,” a senior CCD officer said.
The company has to pay over 18 million USD to Sri Lanka. It did not re-export the generators. In addition, the suspects have also been charged with defrauding Rs 35 million from the Green Win Holdings Lanka Ltd., the local agent company of the Hong Kong-based Listed Company, V Power Holdings.
The CCD investigation has been halted due to political interference, sources said, adding that the suspects had approached a Cabinet minister.
Asked for comment, senior CEB officials said that there had been a PPA with V Power Holdings but it had been cancelled by the CEB. With the cancellation of the agreement, the company loses their rights for duty concessions, a top management level officer of the CEB told The Island.
Customs Media Spokesman and Deputy Director (Legal) Sudattha Silva said that the Compliance and Facilitation Division of the Department was conducting an investigation. He said he was not in a position to comment more as the investigation was in progress.
The V Power Holdings was accused of violating the Section 50 (A) (1) (a) (b) of the Customs Ordinance.
When contacted for comment, Chairman of Green Win Holdings Lanka Ltd, Vajira Wickramasinghe said. That there were two investigations into the aforementioned incidents.
“We signed the PPA with CEB as the Sri Lankan representative of the V Power Holdings of Hong Kong. The V Power Holdings’ Chief Commercial Officer sent a Singaporean of Lankan origin to work with us. Later, it was found that Singaporean with the help of a former director of our company, carried out the fraud. They have misused the canceled PPA to clear the consignment from the harbour. Now, the CCD says that they cannot find the Singaporean and the Lankan who have gone into hiding. I hope that the investigations will resume and the culprits will be caught so that justice will be done.”
News
PSTA worse than PTA: FSP
The Frontline Socialist Party (FSP) yesterday accused the government of seeking to use the proposed Protection of the State from Terrorism Act (PSTA) to suppress popular political activity, claiming that some of its provisions were more repressive than those of the Prevention of Terrorism Act (PTA).
FSP Education Secretary Pubudu Jayagoda told a media briefing, in Nugegoda, that the definition of terrorism in the Bill was so broad that it could be used to label almost any form of popular political activity as terrorism.
He said the Bill’s approach to defining terrorism was based largely on attempts to compel a government, or an international organisation, to do, or refrain from doing something, rather than on internationally recognised criteria, such as killings, causing serious bodily harm, kidnapping or acts intended to spread terror among the public.
Jayagoda also alleged that the Bill transferred substantial powers from the judiciary to the executive, while extending powers of arrest, investigation and detention to the armed forces, in addition to the police.
He claimed that the government had sought to portray the Bill as a replacement for the PTA while retaining or introducing provisions that could facilitate political victimisation and repression.
The FSP also questioned the government’s decision to proceed with the Bill, despite having previously sought public views on an earlier draft.
Jayagoda said a draft had been published earlier this year, with the period for public submissions ending on February 28, but the Bill subsequently gazetted was essentially the same draft with some provisions rearranged.
Jayagoda also referred to a letter reportedly sent by Attorney-at-Law Saliya Peiris, a member of a Committee, chaired by President’s Counsel Rienzie Arsecularatne, that had been appointed to draft the legislation. He said Peiris had stated, in the October 06 letter, that changes had been made to the draft prepared by the Committee.
“This means that even the Committee, appointed to prepare the Bill, was a deception,” Jayagoda alleged.
He said that the PSTA was fundamentally similar to the Anti-Terrorism Bill introduced by the previous government, in 2023, which the National People’s Power (NPP) opposed and challenged in court.
“If the NPP opposed that Bill then and is now bringing the same legislation before Parliament, the government must explain its position,” he said.
Jayagoda called on NPP MPs to oppose the PSTA in Parliament and urged trade unions and other groups to build a broad public movement against the legislation.
He challenged the government to an open debate on the Bill.
News
Shiranthi R remanded until 13 Oct.
Former First Lady Shiranthi Rajapaksa was yesterday remanded until 13 October after being produced before the Colombo Magistrate’s Court following her arrest by the Commission to Investigate Allegations of Bribery or Corruption (CIABOC).
Shiranthi, wife of former President Mahinda Rajapaksa, was arrested at her residence on Poorwarama Road, Kirulapone, after CIABOC officers recorded a statement from her for nearly two hours.
According to the CIABOC, the arrest was made over allegations that Rs. 10 million obtained from the National Savings Bank through the Siriliya Saviya organisation was misappropriated.
The money was allegedly obtained to provide a Computed Tomography (CT) scanner to the children’s hospital. Investigators allege that the scanner was not provided and that the funds were instead unlawfully used.
CIABOC is investigating alleged offences under the Public Property Act and corruption-related provisions in connection with the transaction and other financial activities involving Siriliya Saviya, which was headed by Rajapaksa.
Rajapaksa returned to Sri Lanka on Monday night on a flight from Malaysia after travelling overseas for medical treatment. She left for Singapore on 16 September after being admitted to a private hospital in Colombo on 15 September following an illness.
She had been due to appear before the Financial Crimes Investigation Division (FCID) on 13 October in connection with its investigation into the financial affairs of Siriliya Saviya.
Meanwhile, her lawyers filed an anticipatory bail application before the Maligakanda Magistrate’s Court on Monday, seeking an order preventing her arrest in connection with the FCID investigation.
News
Former NSB Chairman Kariyawasam granted bail
Former National Savings Bank (NSB) Chairman Pradeep Kariyawasam was yesterday granted bail by the Colombo Magistrate’s Court following his arrest by the Commission to Investigate Allegations of Bribery or Corruption (CIABOC).
Kariyawasam, husband of former Chief Justice Shirani Bandaranayake, was arrested in connection with the Bribery Commission’s investigation into the ‘Siriliya Saviya’ account linked to former First Lady Shiranthi Rajapaksa.
The investigation concerns financial activities involving the Siriliya Saviya initiative, which was headed by Rajapaksa, wife of former President Mahinda Rajapaksa.
CIABOC is continuing investigations into the alleged financial irregularities relating to the account.
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