Editorial

Will exposés become fish wrappers?

Published

3 years ago

2021/10/17

Journalists the world over are familiar with an expression worn thin over decades and more: ‘yesterday’s news is only fit to wrap the fish in!’ That’s exactly what’s happened to the Pandora Papers that made big news a few days ago in this country and many others globally who’s leaders/citizen had been fingered. A week later, with three weeks yet to go for the Commission to Investigate Allegations of Bribery and Corruption to respond to President Gotabaya Rajapaksa’s one month’s deadline for a report, the whole business is nearly forgotten. Hardly a bleat is heard. Readers would remember that the Panama Papers where a massive data base of some 11.5 million files from Mossac Fonseca, the world’s fourth biggest offshore law firm made global waves; and a number of Lankans and companies incorporated here were named. But this is now less than a dim memory. That was over five years ago and, as far as we know nothing much has happened since, anywhere, about that exposé, also by the International Consortium of Investigative Journalists. Will that material, and this, eventually become fish wrappers?

However that be, there are many matter that arise that deserve attention not only from governments but also from the wider public. All of us are aware of the numbered bank accounts that have made Swiss banks both rich and famous. Such accounts, with multi-digit numbers known only to the client and selected bankers, add another layer to banking secrecy. But they are not completely anonymous. That’s because the name of the client is still recorded by the bank and is subject to what’s called “limited warranted disclosure.” Such hiding holes are widely sought by the wealthy to stash away both legitimate and ill-gotten wealth from the prying eyes of governments, law enforcement agencies, taxpeople and sometimes even spouses. Lesser known is the fact that such facilities are no longer the exclusive preserve of the Swiss. They are now available in over a dozen countries in Europe, Africa and Asia. Apart from numbered bank accounts, there are many tax havens in several parts of the world widely used for both money laundering and tax avoidance. They are useful not only to those anxious to exploit their possibilities but also to the service-providing countries to enrich national coffers.

Since the Pandora Papers hit the headlines, Pakistan’s Prime Minister Imran Khan has made several noteworthy speeches into the expose` which linked hundreds of Pakistanis, including members of his cabinet to wealth secretly moved through offshore companies. Khan has promised action if wrongdoing is established just as much as our own president has done. Ownership of offshore holding companies is not illegal in most countries including, we believe, Sri Lanka. But they are frequently used to avoid tax liability or to maintain secrecy about large and shady financial transactions. Even before the smelly stuff hit the fan with the publication of the Pandora Papers, Khan addressing the UN International Financial Accountability, Transparency and Integrity Panel called upon countries he termed tax havens to “adopt decisive actions” and return wealth looted from developing countries. Saying that the figures were staggering, he estimated that perhaps a trillion dollars were siphoned off in this manner and much of that were bribes received by corrupt white collar criminals. Demanding that the bleeding of poor and developing countries must stop, he urged that stolen assets of developing countries including proceeds of corruption, bribery and other crimes must be returned immediately.

Where Sri Lanka is concerned, the liberalization of the economy in 1978, not 1977 as commonly stated, resulted not only in devaluation of the currency and the stupendous increase in the money supply, but also the commencing of massive and expensive infrastructure and other development projects of which the Accelerated Mahaweli Development was perhaps the largest. This resulted in the award of gigantic contracts on a scale previously not known in this country. Such contracts also meant commissions, and what these were and who collected them was largely unknown. Since then we have had many other very large projects. While the country knows what the taxpayer paid for these as revealed in the figures presented to parliament and budgeted for, what kind of commissions were paid and to whom, is information largely outside the public domain. While decision-making politicians and perhaps bureaucrats are widely suspected to have been beneficiaries of such loot, companies, some well known and others less so, have been identified as agents of various contractors. Whether such funds were duly accounted for and the taxes thereon paid remains unknown.

Whistles have been blown here but we have unfortunately not been able to obtain the cooperation, for example of the Government of the United Arab Emirates about loot allegedly stashed in Dubai. Nobody can expect companies providing haven to ill-gotten gains to cooperate with bloodhounds on their trail. Imran Khan’s appeal to tax haven providers can only fall on deaf years as has happened before and will continue to happen in the future. Third world countries claiming to pursue criminals who had bled their economies will only do so if the quarry belongs to an opposing camp. Governments will only chase opponents and when they change, investigations already undertaken, not without influence of ruling powers, will be abandoned as we have too often seen. As the late Sunil Perera of the Gypsies so memorably sang, Lankawa ehema thamai, I don’t know why!

All News Advertisement

Editorial

A welcome judgment

Published

3 hours ago

2025/04/3

Sahan Weerasooriya

Thursday 3rd April, 2025

Justice finally caught up with former North Central Province Chief Minister S. M. Ranjith and his sister-in-law Shanthi Chandrasena yesterday, when the Colombo High Court (HC), which heard a case filed by the Commission to Investigate Allegations of Bribery or Corruption (CIABOC) against them in 2021, sentenced them to 16 years RI for having misappropriated Rs. 2.6 million between 2012 and 2014. They were also fined Rs. 200,000 each. The HC judgment must have gladdened the hearts of all those who long for an end to corruption.

The criminal misappropriation of state funds at issue happened during the heyday of the Rajapaksa rule, which became a metaphor for corruption and abuse of power. When politicians are intoxicated with power, they become blind to the consequences of their actions, and enrich themselves as if there were no tomorrow. They usually cover their tracks, but the January 2015 regime change may have prevented CM Ranjith and his sister-in-law, who was his private secretary, from doing so. Their offence, however, pales into insignificance in comparison to what some other members of previous governments have been accused of. Unfortunately, most of those allegations have gone uninvestigated, or escape routes have been opened for the accused in some high-profile corruption cases, which were made to collapse, much to the dismay of anti-corruption campaigners and the public. Thankfully, most of those characters failed to get re-elected last year, and this is something the NPP government can flaunt as an achievement.

Another former Chief Minister––Chamara Sampath Dassanayake––has been remanded for causing a huge loss to the Uva Provincial Council by withdrawing six fixed deposits prematurely in 2016. It is hoped that all allegations of corruption, abuse of power and serious crimes such as murder against the members of previous administrations will be probed thoroughly and the culprits prosecuted expeditiously.

Corruption usually thrives under powerful governments in this country because huge majorities tend to nurture impunity. Integrity of most Sri Lankan politicians is a mere result of the unavailability of opportunities to line their pockets rather than an unwavering commitment to moral principles. Power tends to have a corrosive effect on scruples, and many self-proclaimed champions of good governance, who come to power, vowing to rid the country of corruption, end up being as corrupt as their predecessors. What we witnessed following the 2015 government change is a case in point. The ‘paragons of virtue’ in the UNP-led Yahapalana camp committed the first Treasury bond scam a few weeks after being voted into power. The present-day leaders who are campaigning hard against corruption were on a political honeymoon with the UNP at that time, and their alliance lasted until the end of the Yahapalana government in late 2019 despite very serious allegations of corruption against that administration.

There is nothing stupider than to rely on individual politicians to rid the country of bribery and corruption. They may have allegations of corruption against their political rivals probed, but it is doubtful whether they are serious about eliminating bribery and corruption. One may recall that having come to power by campaigning mainly on an anti-corruption platform, in 1994, the SLFP-led People’s Alliance government, ably assisted by several other political parties, including the UNP and the JVP, effectively deprived the national anti-graft commission of its suo motu powers, making it dependent on formal complaints to take action. Hence the need for anti-corruption laws with stronger teeth and robust institutional mechanisms to battle bribery and corruption. All existing anti-corruption mechanisms should be given a radical shake-up.

Editorial

Another Mafia

Published

1 day ago

2025/04/2

Sahan Weerasooriya

Wednesday 2nd April, 2025

Petrol was unavailable at some filling stations yesterday as their stocks had not been replenished in anticipation of a petrol price reduction. The government reduced the prices of petrol by Rs. 10. Long lines of vehicles were seen near the fuel stations where petrol was available. Some people delayed refuelling their vehicles until the announcement of the monthly fuel price revision, expecting substantial fuel price reductions in view of the upcoming local government (LG) elections. That too may have led to a marginal increase in the demand for fuel yesterday morning.

There have been numerous instances where speculation of downward price revisions led to fuel shortages. Fuel retailers have become a law unto themselves and do not care to maintain adequate petroleum stocks. A similar situation is bound to occur early next month as the government is expected to decrease fuel prices in view of the upcoming local government elections. So, precautions will have to be taken to foreclose such an eventuality.

There is a pressing need for stringent regulation of fuel retailing to ensure that all filling stations maintain petroleum stocks at the stipulated levels. Noncompliance should result in penalties. Previous governments gave filling stations owners kid-glove treatment for obvious reasons; it was only the businesspeople with political connections who could establish fuel stations, and some of them were family members of politicians. Those who voted the NPP into power expected their interests to prevail over those of unscrupulous businesses, such as rice millers, and fuel retailers, but sadly the status quo remains. NPP leaders flex their muscles and order pre-dawn raids on peaceful protesters just like the Rajapaksa-Wickremesinghe government, but they have no qualms about kowtowing to the exploiters of the public!

Meanwhile, filling stations, save a few, have earned notoriety for various malpractices such as meter tampering and pumping in bursts. Regulatory authorities do precious little by way of conducting regular inspections and calibrations of fuel dispensers, making one wonder whether they are in league with the unscrupulous fuel retailers. The government must put its foot down and take action to safeguard the interests of the public and ensure that fuel consumers get their money’s worth without hassle.

Propaganda and reality

The NPP government has pulled out all the stops in a bid to win the upcoming local government (LG) elections. While it is leveraging everything at its disposal to achieve that end, its propagandists are claiming that it needs to have control of all local councils to be able to serve the public better. They would have the people believe that the JVP/NPP is not controlling the LG institutions at present. But this claim does not bear scrutiny.

Local councils have remained functional although they are without elected representatives. They have been under Special Commissioners (SCs). The SCs report to the Provincial Governors, who are appointed by the President. Thus, all local councils are currently under President Anura Kumara Dissanayake for all intents and purposes.

One can understand why the NPP is campaigning so hard to bag the local councils. It wants to win the mini polls and cement its impressive victories in last year’s national elections. However, the argument that unless the people vote for the NPP overwhelmingly again, enabling it to gain control of all LG institutions, it won’t be able to carry out its pledges, is flawed. That is a propaganda lie.

One may recall that the Colombo Municipal Council remained under UNP control during the UPFA and SLPP governments, but that did not stand in the way of the development of the City of Colombo. The JVP won the Tissamaharama Pradeshiya Sabha in 2002 while the UNP was controlling Parliament and Chandrika Bandaranaike Kumaratunga was holding the executive presidency. Governments have to come to terms with such situations.

All signs are that the government and the Opposition will have to cooperate in many LG institutions, after the upcoming mini polls, for those councils are very likely to be hung.

Editorial

Ground Zero of corruption

Published

2 days ago

2025/04/1

Sahan Weerasooriya

Tuesday 1st April, 2025

New laws will be made soon to facilitate the seizure of ill-gotten assets of the corrupt, President Anura Kumara Dissanayake has said at a recent NPP campaign rally. The government has chosen to crank up its anti-corruption campaign again as the local government polls are drawing near. Laws with stronger teeth to deal with corruption cannot be overstated.

Hydra-headed corruption can manifest itself in various forms at different levels, which can be individual, political, corporate, systemic and cultural. It has become extremely difficult to rid Sri Lanka of corruption because of the prevailing culture of corruption. The focus of all anti-corruption drives launched by some governments including the incumbent one has been on tackling corruption at the individual level, as evident from the cases filed by the Commission to Investigate Allegations of Bribery or Corruption against politicians out of power and state officials.

Much is being spoken about allegations of bribery, fraud, nepotism, cronyism, embezzlement, etc., against former government leaders and their bureaucratic lackeys. There is no gainsaying that corrupt individuals have to be brought to justice, but corruption at the political party level must also be addressed. Successive governments have failed to tame the rice millers’ cartel owing to corruption. Wealthy millers have huge slush funds, part of which they dish out to political parties and politicians of all hues so that their interests will be served whoever comes to power. This quid pro quo has stood them in good stead. Curiously, even the JVP/NPP leaders who roared like lions before last year’s elections, vowing to take on the so-called rice Mafia and safeguard the interests of farmers and consumers, are now mewing.

The questionable green-channelling of as many as 323 red-flagged freight containers in the Colombo Port in January can also be considered an instance of corruption, for they are believed to have carried contraband. Big businesses bankroll election campaigns of political parties and politicians of their choice and receive favours in return. The sugar scam is a case in point. Following the 2019 regime change, the SLPP suddenly reduced the special commodity levy on sugar imports from Rs. 50 a kilo to 25 cents a kilo for the benefit of some of its financiers who had ordered a huge stock of sugar. The state coffers lost billions of rupees as a result.

The NPP government is under pressure to have former Central Bank Governor Arjuna Mahendran extradited from Singapore to stand trial here for the Treasury bond scams. Strangely, those who are out for Mahendran’s scalp have stopped short of calling for a probe to find out how the UNP benefited from the Treasury bond scams. The UNP headquarters, Sirikotha, was struggling to pay its utility bills at the time of the January 2015 regime change. But it outspent its political rivals including the UPFA in the run-up to the August 2015 general election! It is believed that the UNP benefited from the largesse of the Treasury bond racketeers.

In Sri Lanka, which is known for the weak enforcement of campaign expenditure laws and a chronic lack of accountability, headquarters of political parties are believed to be built on foundations of undeclared funds, including black money.

The SLPP repaired its headquarters in record time following the 2022 mob attacks, which inflicted extensive damage on it. Where did funds for the construction of that place and repairs to it come from? Some Opposition politicians have alleged that the JVP is the richest political party in Sri Lanka, and cast suspicion on how funds were raised for the construction of its headquarters at Battaramulla. The SLFP, which was in penury for 17 years after its ignominious defeat in 1977, enriched itself after its comeback in 1994. The SJB has also spent huge amounts of funds on its election campaigns and social welfare projects. How has it raised funds?

It is believed that political parties are the ground zero of corruption in this country, given their undeclared funds, only a part of which they spend on their election campaigns. There is a pressing need to probe the assets of these parties, whose holier-than-thou leaders embark on anti-corruption crusades to garner favour with the public. That, we believe, will be half the battle in ridding the country of corruption.