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EXPOSÉ

Gayan Kumara Weerasingha

Mt Lavinia Magistrate Harsha Setunga remanded Chairman Ceylinco Consolidated, Deshamanya Lalith Kotelawala for two weeks in connection with the Golden Key scam as he had said that he could not guarantee a plan to return Rs 26 billion to depositors within 10 days.

CID investigations have revealed that Dr Kotelawala had set aside Rs 3.5 million every month from the Golden Key credit card company for expenses in the chairman’s office of Ceylinco Consolidated. He had also allocated Rs 500, 000 for a special fund named Sarana, Rs 200, 000 for the Aratuwa newspaper, Rs 500, 000 for the Solo-U fund, and Rs 400, 000 as director fees, on a monthly basis. Kotelawala’s wife, Sicille Kotelawala was paid Rs 250, 000 as director fees, and Rs 4.5 million as gratuity every month. It is also alleged that she had obtained a large gratuity payment from Golden Key company when she left it, by falsely claiming that she had served 25 years with the company, when in reality, she had served only 17. She had also undertaken many trips overseas using money accrued to the Golden Key company.

All this was revealed during an investigation launched by the CID to ascertain what exactly happened to the Rs 26 billion deposited with the Golden Key credit card company. One of the reasons for the fraud at the Golden Key credit card company was “irresponsible actions of its management,’’ CID determined.

To Australia on multiple occasions

Kavan Perera had functioned as the chief executive of Golden Key (Pvt) Ltd. He was also the deputy chairman of Golden Key. The CID has also revealed that a financial fraud had also occurred in the establishment of a company affiliated to Golden Key and in appointing a woman by the name of Nandani Kumari to a senior position of the company. This woman is alleged to have been a minor level official with Ceylinco Consolidated. The affiliated company in question has been identified as Golden Key Australia (Ltd), based in Melbourne. Kavan Perera is alleged to have travelled with this woman to Australia on multiple occasions using money from Golden Key every year --- and they had spent millions of rupees during these trips. According to reports, Rs 144 million had been spent on overseas trips alone.

The CID has also recovered details to the effect that a member of the board of directors had deposited Rs 64 million in his own private bank account claiming the money as salaries for staff of Golden Key, Australia. The CID believes that such frauds, coupled with improper financial management had contributed to the staggering Rs 26 billion loss at Golden Key.

The Rs 26 billion came from the money of 9217 depositors. Among the depositors is a person who had deposited over Rs 100 million and another who had deposited over Rs 200 million, both making a combined total of over Rs370 million. 437 depositors have deposited amounts between Rs 10 million and Rs 100 million. The total amount they have deposited amounts to over Rs 800 million.
The majority of depositors with the Golden Key credit card company have deposited between Rs 01-10 million. 4820 depositors fall into this category. Their combined deposits are worth over Rs14, 000 million. 3955 other depositors have deposited amounts below Rs 01 million. Their combined deposits are worth over Rs 2000 million.

The Golden Key credit card company had spent Rs 6 billion out of the Rs 26 million belonging to its 9217 depositors to open 49 affiliated companies. The majority of these companies are simply limited to their names only, and do not make any profit, Golden Key Australia (Pvt) Ltd being one of them. The Golden Key credit card company had also spent an additional Rs 17 billion to pay interest to its 9217 depositors.

The company had been paying annual interest between 21-29% to its depositors.

The remaining Rs 7 million was the money which the management had used on overseas trips, withdrawn as gratuity and used for the various funds that had been set up.

Nevertheless, the company is duty bound to pay the entire amount of Rs 26 billion which it had taken from its depositors. However, under the scheme which the company proposed to pay off their depositors, the company hopes to return depositor’s money excluding interest which it has already paid. This means that the company is proposing to pay just Rs 13 billion, instead of Rs 26 billion.
This proposal has not met with the approval of the attorney-general’s department. AG’s Dept., had asked Kotelawala to pay the entire Rs 26 billion within 10 days for the convenience of the depositors and the government. This was conveyed to him on the 26th, through Court.

Properties under Court care?

The Court is also considering placing all affiliated companies of Golden Key and their properties under its own care. Sources from the attorney-general’s department stated that a decision on this is likely to be conveyed at the next Court hearing on the case.

Meanwhile, officials are also making plans to change the CID team which has so far handled the Golden Key case.

Up to now, the CID’s investigation division I, handled investigations. Police Inspector P Vishvanadan is in charge of this division. His division handled the investigations under the direction of a CID SP. However, two police officers from outside the CID were later appointed to the team, on instructions from the attorney-general’s department. These two officers were SSP V Indran of the organized crimes investigation division at police headquarters and Chief Inspector Kamal Pushpakumara of the special investigation division, bureau of foreign employment. SSP Indran withdrew from the investigation a few days after assuming duties and Chief Inspector Kamal Pushpakumara, on the 26th.

However, officials immediately took steps to appoint two other officers to replace them --- SSP Eric Perera from the police anti-narcotics bureau and SP D R L Ranaweera, who is the director of the police central anti-vice squad based in Walana, Panadura. It was as a result of their investigations that Kotelawala was arrested and remanded.


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