by Saman Indrajith Courtesy The Island

* Calls for recovering losses from culprits
*Chairman prevented from revealing his ordeal
*AG will have to be consulted – PM

October 28, 2016, 11:55 pm

COPE Chairman Sunil Handunnetti informed Parliament yesterday that his committee had found that former Central Bank Governor Arjuna Mahendran was directly responsible for the Treasury bond scam and recommended legal action against him and the other Central Bank officials responsible for it.

Handunnetti, presenting the report on Treasury bond scam, said that the committee observed that there was enough ground to believe that former CB Governor Mahendran had interfered with or exerted his influence on the bond sales from Feb. 27, 2015 to May 2016.

He said that the incident had led to an erosion of confidence in the Central Bank.

The COPE has observed that Perpetual Treasuries recorded massive profits and recommended that if the company’s profit making has resulted in any loss to the Central Bank or the government, then it should be recovered from it by initiating legal action.

The COPE recommends that Parliament should directly intervene to monitor the process of implementing the watchdog committee recommendations and to prevent the recurrence of such incidents in the future.It recommends a proper mechanism be in place in the CB and affiliated institutions to prevent similar incidents in the future.

It recommends that the President appoint a special observation group to monitor financial activities of the CB.

The COPE recommends holding a separate investigation into Perpetual Treasuries Ltd.

The COPE Chairman said all the members collectively had agreed to the 15 recommendations of the report, but there had been dissent on the content. He said out of the 26 members in the Committee 16 members had endorsed the report without footnotes, whereas nine members had endorsed it with footnotes.

The 16 members who endorsed it without footnotes include JVP MPs Sunil Handunnetti,  Anura Kumara Dissanayake, Bimal Ratnayake, Dr Nalinda Jayatissa, UPFA MPs Anura Priyadarshana Yapa, Dayasiri Jayasekara, Lakshman Seneviratne, Lasantha Alagiyawanna, Chandrasiri Gajadheera, Mahindananda Aluthgamage, Weerakumara Dissanayake, UNP MP Rauf Hakeem, and TNA MPs S Sritharan, M A Sumanthiran, Gnanamuthu Srineshan and Mavai Senathirajah.

The nine members who endorsed it with footnotes include Dr Harsha de Silva, Ajith P Perera, Sujeewa Senasinghe, Hector Appuhamy, Ravindra Samaraweera, Wasantha Aluvihare, Ashok Abeysinghe, Abdullah Maharoof and Harshana Rajakaruna. UNP MP Ranjan Ramanayake remained neutral.

The report contains 55 pages and annexes running to 1,900-2,000 pages. It deals with the investigations into the CB Treasury Bond sales from February 2015 to May 2016. It includes 15 recommendations and 15 conclusions.

Handunnetti tabling the report called on the students, university academics, professionals, specialists in the finance sector and the media to study the report carefully and note the dissenting views in the content and the footnotes.

He called the report that came out yesterday a victory of all who were against corruption, waste and abuse of public money. He said, as a Member of Parliament and COPE for 16 long years and as the Treasurer of Asia Pacific Regional Forum on Anti-Corruption he was glad to present the report to the House.

Handunnetti said the draft report had been presented before the Committee on October 20 and it was endorsed by eight out of 14 members who were present at the meeting on October 21. “I want to stress that the recommendations given on my original draft on October 21 remain intact in the report that I table today. They have been endorsed by all. There was only one change and that was made based on a legal point made by MP Sumanthiran,” he said.