News

Central Bank Deputy Governor to be transferred? 

  • Ex-Provincial Governor Rajith Keerthi Tennakoon alleges witch-hunt 
  • Alleges officials behind forensic audits being transferred 

BY Dinitha Rathnayake 

Following the transfer of Central Bank of Sri Lanka (CBSL) Assistant Governor K.M.A.N. Daulagala, there are plans afoot to transfer CBSL Deputy Governor in charge of Foreign Exchange K.M. Mahinda Siriwardana, alleged civil society activist and former Provincial Governor Rajith Keerthi Tennakoon yesterday (21). 

“Just as Assistant Governor of the CBSL K.M.A.N. Daulagala was removed from the post of the Secretary to the Monetary Board, the Deputy Governor Siriwardana, is to be relieved of his foreign exchange-related responsibilities,” he claimed.

Tennakoon claimed that the transfer of Daulagala and the plans to transfer Siriwardana are due to their role in the compilation of the Forensic Audit (FA) reports related to the issuance of Treasury Bonds and transactions of the Employees’ Provident Fund (EPF). 

“Five forensic audit reports on CBSL-based scams have been released so far. The authorities have received reports of a number of CBSL-based financial crimes, including the Edirisinghe Trust Investments (ETI) Finance Presidential Commission report and the report on the hedging fund loss. Now, the CBSL officials involved in these investigations are being transferred by the same people who are accused of concealing financial crimes,” he further alleged.

According to him, short-sighted and questionable decisions taken by the CBSL and the Monetary Board over the years are some of the reasons leading to the country’s economic downfall. 

“On page 16 of one of the Founding CBSL Governor John Exter’s reports, which was the basis for the establishment of the CBSL, it states that ‘the Governor should be a man of recognised and outstanding competence, integrity, and responsibility’. It is a tragedy that the economic management of the country has been handed over again to those who don’t have these qualities,” he claimed.

Samagi Jana Balawegaya (SJB) Parliamentarian Rohini Kumari Wijerathna Kavirathna on 20 September alleged that the removal of Daulagala is an attempt to cover up illegal activities that have occurred within the CBSL and to pave the way for further misconduct. 

“It is now well established that a former CBSL Governor and his family were involved in the plunder of the CBSL and public wealth. It was this official (Daulagala) who, as the Monetary Board Secretary, co-ordinated with the Attorney General’s Department when the above truth was revealed before the PCoI (Presidential Commission of Inquiry). She has also managed to obtain the approval of the Monetary Board, call for tenders, and award tenders for the preparation of the relevant inquiry audit report. I kindly request all women’s organisations, citizens, public servants, and civil society activists in Sri Lanka to speak out against this injustice,” she said.

However, recently appointed CBSL Governor Ajith Nivard Cabraal, when contacted by The Morning in this regard, vehemently denied these allegations and claimed that there were no plans to transfer Siriwardana.

Siriwardana has more than 30 years of service in the CBSL and prior to his appointment as Deputy Governor, held the key positions of Assistant Governor and Director of Economic Research Department of the CBSL. He was on release to the International Monetary Fund (IMF) as the Alternate Executive Director for the constituency comprising India, Sri Lanka, Bangladesh, and Bhutan during the period from July 2017 to October 2019. He was also on release to the Ministry of Finance from October 2010 to April 2015 to serve as the Director General of the Fiscal Policy Department and also as an Additional Director General of the National Planning Department.

He has also served as a member of the Board of Directors/Treasury Representative in several institutions, including Bank of Ceylon, Commercial Bank of Ceylon PLC, National Savings Bank, Sri Lanka Ports Authority, Board of Investments of Sri Lanka, Export Development Board, Sri Lanka Export Credit Insurance Corporation, and Sri Lanka Vocational Training Authority. He holds a Master of Arts (MA) Degree in Economics and a Postgraduate Diploma in Economic Development from Vanderbilt University, USA and a Bachelor of Arts (BA) (Special) Degree in Economics from the University of Kelaniya. 

Meanwhile, the CBSL announced yesterday (21) the appointment of Assistant Governor (AG) J.P.R. Karunaratne as the Secretary to the Monetary Board (SMB) with effect from 15 September 2021.

Karunaratne holds a Master of Commerce Degree in Finance from the University of New South Wales, Australia, a Postgraduate Diploma in Applied Statistics, and a Bachelor of Science (Physical Science) Degree from the University of Colombo. He is a Fellow Member of the Chartered Institute of Management Accountants, UK and an Associate Member of the Certified Management Accountants (CMA) of Sri Lanka.

“The CBSL also wishes to state that, as indicated above, responsibilities and functions assigned to all officers of the CBSL including senior officers are subject to change from time to time in the best interests of the CBSL as determined by the management. Further, it should be noted that transfers of staff and rotation of officers in a financial institution is an essential and vital component of internal control and internal check,” the statement issued by CBSL announcing the new appointment added. 

The total of five forensic audit reports, which were tabled in Parliament in January 2020 by then Speaker Karu Jayasuriya, uncovered a loss of billions of rupees to the Treasury through the issuance of Treasury Bonds between January 2002 to February 2015, primary and secondary market transactions of EPF between January 2002 and February 2015, and EPF transactions in listed and unlisted equities between January 1998 and December 2017.