|
|
Rs. 393 m to Kotelawala from People`s Bank Sri Lanka
Sunday, 4 January 2009 - 9:54 AM SL Time
 Share On Facebook
|
|
|
The bank overdraft of Golden Key Credit Card Company has run into Rs. 393 million after it used the money in its two deposits with the People`s Bank to pay for its depositors, `Ravaya` reports quoting internal sources of the bank.
GKCCC and Golden Key Trading Company had separate accounts maintained at BoC`s Majestic City branch, which had reached this overdraft figure before the crisis spread to affect Seylan Bank.
One of the Ceylinco Consolidated companies owned by Lalith Kotelawala, GKCCC`s overdraft in account no: 001-8-3226518 had stood at Rs. 246 m by November 28th, 2008.
The company also had accounts maintained at Standard Chartered Bank and Bank of Ceylon, which are yet to reveal the amount of the overdrafts it had granted to GKCCC.
Attempts by the newspaper to reach the chairman and the general manger of BoC for a comment had been unsuccessful.
However, a top official of the marketing division of the bank has later telephoned `Ravaya` to say that he would furnish the details after obtaining them from the assistant general manager.
As there had been a long delay of his coming back with the required details, the newspaper has telephoned him, to be told that he would provide the details, adding that the overdraft was not a very big one.
Meanwhile, GKCCC`s account no: 0860-010004-001 at Seylan Bank had reached an overdraft of Rs. 816 m by December 18th, 2008.
The company stands accused of defrauding Rs. 26 billion from its depositors, but it had maintained a different account in an attempt to cover up the fraud.
The CID is investigating this aspect of the swindle following a complaint it has received.
And, as a result Mr. Kotelawala and his wife have been barred from leaving the country and GKCCC`s directors have been summoned to appear before the court, said `Ravaya`.
Golden Key affiliates of Ceylinco Consolidated:
Golden Key Real Estate Agency Ltd.
Golden Key Credit Card Co. Ltd.
Golden Key Co. Ltd.
Golden Key Card Technologies Ltd.
Golden Key Communications (Pvt) Ltd.
Golden Key Trading Co. Ltd.
Golden Key Software Solutions Ltd.
Golden Key Travels (Pvt) Co. Ltd.
Golden Key International Trading Co. Ltd.
Golden Key Institute of Information Technology Ltd.
Golden Key Institute of Computer Technologies Ltd.
Golden Key Hospital Ltd.
Golden Key Agro kem Ltd.
Golden Key Reproductive Health Ltd.
Golden Key Tea Factory Ltd.
Golden Key Minerals Ltd.
Golden Key Holdings Ltd.
Golden Key Call Centre Ltd.
Golden Key Management Services Ltd.
Golden Key Consumer Products Ltd.
Golden Energy Co. Ltd.
Golden Key Motor Co. Ltd.
Golden Key Designer Homes Ltd.
Golden Key Consumer Durables Ltd.
Golden Key Plantations Ltd.
|
|
|
Spetsnaz1
Joined: Jun 2006
Posts: 2650
Member Profile
|
 4 Jan 2009 08:46:11 GMT Report for Abuse
|
| Well got a lot of things going on with GK,... lets hope Mr.Kotalawala pulls something out here rather than putting his clients and depositors down.. if he fails to keep his promise on paying his depositors of GK then his entire establishment will collapse.. and I dont think he is willing to take that risk... |
Ajithcy
Joined: Dec 2008
Posts: 5
Member Profile
|
 4 Jan 2009 10:16:22 GMT Report for Abuse
|
| The real culprit should be brought to justice...hope Mr. kotalawala is cleared?????????????? |
justman
Joined: Mar 2006
Posts: 1155
Member Profile
|
 4 Jan 2009 17:13:15 GMT Report for Abuse
|
I am sure Mr kothalawala is not a culprit but there must be some dishonesty at the levels below as it is norm for a country like that and it is impossible for L.K or anyone to keep a tab on every level of his empire.I hope this company will not go down as it is a hope for many who would invest to get a decent return.
Even Madoff's schemes would have paid off on the long run should there was no credit crunch of this proportion otherwise prestigious fund managers wouldn't have invested in his hair brain schemes.People of this nature likes to take risks which would be very calculated in the normal times and this not a normal time for anyone and never in our history we have seen a such a down turn.Ceylinco must be treated as a sacred institution for the said reason and the investors must rally round at this crucial moment.This economic downturn is a blessing to all of us in the business community as the good few years had made the employee and employers complacent and the gravy train does not last long.Time to take stock of what one has,cut the dead wood in the company,cut the waste,stupidity and incompetence thus resulting in VALUE FOR MONEY FOR CUSTOMERS.
Our politiceans of all hues seems to not follow this vital principle any any watch dog the state provides like the CB has no significance to oversee the workings of any private institutions in the land and we must respect the policy of Mrs Thatcher who were bred and brought up in a small business family that there should be no state intervention but leave everything to market forces and this principle will rule over every aspect of our lives.
So Mr LK must make use of this sad situation to correct his company and get rid of the short comings that have found a place in that firm and correct it to bring back the customer confidence which is vital to his type of business.
Also he must go to lengths to reassure his depositors and explain to them,at least to the big depositors as to where the money had been invested and these big ones must be used to explain to the small depositors that it's OK to keep their money in ceylinco.I hear most of it is undeclared and more the reason for what I said.I would not deal with undeclared money as it is not proper.
Worst that happens to Cylinco is for depositors to withdraw all the money all at once.
GOSL must not get involved at all as they are the worst culprits for using the deposits of people who had paid their AP and ... for absurd and worthless ventures like the mihin air and besides the gosl makes it worse for everyone when in a crunch the are able to print money.
Edited By - justman - 4 Jan 2009 17:17:35 GMT |
Joy09
Joined: Jan 2009
Posts: 19
Member Profile
|
5 Jan 2009 02:19:39 GMT Report for Abuse
|
Hi Justman:
It is not the world recession that has brought about the collapse of GK. See my posting under Golden Key Fraud for details of how this happened. Really those of us who knew the actual situation were aware a longtime ago that this will happen. Our pleas to the regulators far back in 2003 fell on deaf ears. The media never wanted to publish anything against Ceylinco fearing loss of advertising revenue from the entire group(which is substantial). Hence ultimately it is the public who suffer. The interesting question is when we, who are outside the Company knew that something was radically wrong with the Company how come Mr.LK who was Chairing the Board meetings of the Company and who was entitled to more detailed information from the officials of the Company than us did not know what was going on? The second point I want to make is that any prudent businessman will have an independent outside auditor to have the affairs of the Company audited. This is requirement is very much needed in a Company that is involved in taking public deposits where the stakes are much higher. Who were the auditors of GK and haven't they warned Mr. LK of the state of GK? Can Mr.LK publicly issue a statement in this regard? The third question I want to ask is did Seylan Bank which reportedly gave an overdraft of Rs.816 Million to Gk ask for the latest audited balance sheets of GK ? If they have not done so it is very strange because from other clients who want much smaller amounts with good security they ask for those statements. How come they gave such a large overdraft either without such statements or if they had those statements after knowing the state of affairs? The overdraft that was given by Seylan is public money and not Mr. LK's personal monies. The depositors are entitled to have this question answered by Seylan.
It is easy for us who are either not affected or who are in a position to absorb any fall out of the crisis to say that people must have faith in Ceylinco but for a person who has put his hard earned life savings in Ceylinco what matters is the protection of his money. When Mr.LK has lost the confidence placed by the public in him in such a shameful manner, how can anyone expect the depositors to continue patronizing companies headed by him or his cronies?
Remember the rule of survival.It is not the survival of the largest but the survival of the fittest. You can ponder where LK's empire fits in. |
kiwikanga
Senior Member
Joined: Nov 2005
Posts: 2817
Member Profile
|
 5 Jan 2009 02:35:24 GMT Report for Abuse
|
Joy09,
I tend to agree with the observations of Joy09. I wish to add the fact that GKCCC was not a registered financial institution with the Central Bank to deal with public finances and therefore was acting illegally when it started to deal with finances of the general public. Is it LK's position that he was unaware of this illegality?
Edited By - kiwikanga - 5 Jan 2009 02:36:46 GMT |
kiora
Joined: May 2006
Posts: 339
Member Profile
|
5 Jan 2009 08:54:30 GMT Report for Abuse
|
| Surely GK supporters not having any doubts about his honesty and integrity now are they. |
Joy09
Joined: Jan 2009
Posts: 19
Member Profile
|
5 Jan 2009 14:31:46 GMT Report for Abuse
|
Hi kiwikanga,
That was a very pertinent point you raised. Mr.Lk's response to that was Mr. Khavan Perera told him that it was not illegal to take in those deposits and he obviously believed him. What a statement to be made by a chairman of 4 banks and 4 or 5 finance companies and one who was filing actions against the regulators for various trivial matters.It is similar to the statement made by him on the Blue Diamond controversy way back in 2000/2001, when somebody asked him how come he too has signed all the relevant Board resolutions and blame only Mr. Daya Senanayake the then Deputy Chairman? He said that as Chairman of several Companies he signs lots of Board resolutions and did not know what was in them!He never makes mistakes its always the others. Can you trust your hard earned life savings to a man of his caliber!! |
justman
Joined: Mar 2006
Posts: 1155
Member Profile
|
5 Jan 2009 15:25:34 GMT Report for Abuse
|
Joy09
Thank you very much for your post above and I too heard those rumors few years back because but I put my Faith in the Kothalawala family to be honest and capable.He may be honest but not capable to run a such a web of a company and I wish as you mentioned that LK must get an outside audits company to check it's function and business.I still think that we must urge them to put things right as this is one of the few companies left in the country to invest one's hard earned pension money.
I am sure he will return all the monies deposited but to give back 28 billion is a tall order unless he had invested them wisely.Perhaps this is only my own assumption,for the last working days the stock markets have been picking up indicating that the world's economy is picking up and perhaps some of that been invested might recover in 6 month's time and this only a part relief if this company had this problem from the year 2003 as mentioned above.
He must replace his CEO and other key personal immediately as they may be responsible for this mess, a mess that is not created overnight.good luck to all of them. |
NonResident
Joined: Jan 2009
Posts: 15
Member Profile
|
 5 Jan 2009 16:41:40 GMT Report for Abuse
|
Justman/Joy09/Kiwikanga,
The scary part of the whole episode is the numbers keep going up like a taxi meter! 28 Billion plus 1.3 Billion to the banks as per this article is 29.3 Billion. How much more? time will tell. Now what will the depositors get? They may if there is any left over after settling the banks, as the banks will have a first right on Golden Keys assets, as they would not have lent Golden Key money based on a plastic card like the depositors, but would have lent based on agreements which would have in place provisions for a first right of claim. If Golden Key goes into banckrupcy (God Forbid), the depositors will have a right of claim only after all employees too have been settled their final settlement!
We have a financial catastrophe and the Governor of the Central, who admits he was aware GK was sourcing deposits, goes on public record stating the CBSL could not do anything because it was similar to Elephant house taking a deposit for soft drinks bottles! His 'Pyramid Brain' has no ability understand that if Elephant house defaults on soft drink bottle deposits, the customer can sell the bottle to another vendor or at least sell it to a 'Bothal Karaya' and get his money back!
These are the people we have in Sri Lanka, who have been entrusted with the responsibility of maintaining the financial integrity of our country! Where we will head thanks to these so called erudite professionals, only time will tell. The sad thing is the general public has to forego their hard earned life savings for these individuals to make merry. This is not the first instance, we had Gold Creast, then Sakvithi and now Golden Key. Comming soon - Ceylinco Fast Cash (Latest news is they have bangled Seylan Bank for 5 Billion!) |
|
Search All News and Discussions