Three-member committee on Treasury Bond scandal recommends Full Scale Probe
The three-member Committee appointed to investigate the Central Bank bond issue has called for a full-scale investigation by a duly authorized government authority since they have detected an unusual bidding pattern practised by Perpetual Treasuries, the firm that is owned by the son-in-law of the Central Bank Governor, Arjuna Mahendran adding that its securing 50 per cent of the accepted bids was also unusual.
Ceylontoday, 2015-05-20 02:05:00
Read 133 Times
Three-member committee on Treasury Bond scandal recommends Full Scale Probe
By Gagani Weerakoon and Skandha Gunasekara
The three-member Committee appointed to investigate the Central Bank bond issue has called for a full-scale investigation by a duly authorized government authority since they have detected an unusual bidding pattern practised by Perpetual Treasuries, the firm that is owned by the son-in-law of the Central Bank Governor, Arjuna Mahendran adding that its securing 50 per cent of the accepted bids was also unusual.The report of the committee was tabled in Parliament yesterday by Leader of the House Lakshman Kiriella. The committee appointed by Prime Minister Ranil Wickremesinghe was chaired by Attorney-at-Law Gamini Pitipana and comprised attorneys-at-law Mahesh Kalugampitiya and Chandimal Mendis.
The committee has observed that the bidding pattern of Perpetual Treasuries at the bond auction in question was unusual for two reasons: a) considering their previous bidding patterns, bids amounting to
Rs 2,000,000,000 when the value of bond is Rs 1,000,000,000, b) seeking the assistance of BOC to forward bids amounting to Rs 13,000,000,000 given the fact that the value of the bond announced was one billion."
"In the interest of the public since the said transaction involves public funds and fiscal regulations of the government, the committee is of the opinion that a full-scale investigation by a duly constituted government authority is warranted.
"The committee further observers that the Board of Directors of BOC shall initiate a full-scale investigation, and if necessary a forensic audit into the activities of the Dealer room of BOC, given the fact that it is a State bank. The committee further observes that the Board of Directors of the BOC may call explanation from the Chief Dealer and his superior officers with regard to ad-hoc decisions made considering the large portfolio of BOC funds that is involved as stated above."
The committee has observed that "there is a serious lack of transparency pertaining to the activities of the PDD (Public Debt Department) of the CBSL (Central Bank of Sri Lanka).
There is no proper supervision of the activities between the primary dealers and the PDD. There is no recording of calls, there is no log of any documents received, no supervision of electronic footprint such as text messages and emails between the officials of the PDD and the primary dealers."
"Since the PDD is dealing with the most sensitive information of the government, the committee is of the opinion that a proper supervisory and monitoring mechanism has to be immediately implemented with regard to the activities of the PDD and the primary dealers.
"The committee also observes that an internal document of the Central Bank that contains statistics that are highly confidential is in the public domain. The availability of the said document on the web, newspapers, private circulation, complete with all signatures of CBSL officials leaves room to doubt the sanctity of sensitive confidential information within a secure environment of the CBSL. The committee had been informed by the officials of the CBSL that no internal inquiry had been initiated upto date with regard to the question of the said document appearing in the public domain.
The committee said in the report that bonds that are issued are never closed, and the bonds issued several years before are re-adjusted on maturity period and privately placed many years later. "This amounts to lack of transparency and opening out for manipulation and suspicion."
No comments:
Post a Comment