America is the land of opportunity for the honest and the crooked alike. It is full of mysterious millionaires and billionaires like the eponym of Scott Fitzgerald`s unputdownable work, The Great Gatsby. Today, an American billionaire has hit the headlines across the globe over an alleged racket. He happens to be of Sri Lankan origin! Raj Rajaratnam is his name. He was arrested by the FBI and the US Justice Department filed insider trading charges against him and five others last Friday.
Whether Rajaratnam is another Gatsby remains to be seen. But the economic impact of his arrest is already felt in Sri Lanka. Head of the New York-based Galleon Management hedge fund, he invested heavily in some blue chips here. Colombo stocks plunged 1.5 per cent (or 49 points) yesterday. Milanka index dropped by 1.93 per cent (68.6 points). Out of nearly 200 companies that transacted on the CSE yesterday, all, except 18, suffered losses.
The CSE is likely to recover from the tumble sooner or later even if push comes to shove with the EU scrapping Sri Lanka`s GSP Plus concession, as speculated in diplomatic circles. What is unpredictable and far more complex is the political impact of Rajaratnam`s arrest on both Sri Lanka and the US. He is believed to be one of the wealthy Sri Lankans, whose donations to the US based charities found their way into the LTTE`s war chest. He contributed funds to the notorious LTTE front, TRO, which funded the LTTE on the pretext of doing humanitarian work. Having banned TRO in 2007, the US proscribed the Tamil Foundation in February 2009, because the latter was closely linked to TRO.
Interestingly, Rajaratnam, who contributed generously to TRO, donated $ 26,200 to the Democratic Party`s fund raising arm in 2007, according to the Wall Street Journal of Oct. 19, 2009. He also contributed $ 4,600 to Hillary Clinton`s campaign in 2007 and $ 4,600 to Barack Obama`s presidential election campaign in 2008. Obama became the US President and Hillary the Secretary of State!
The Wall Street Journal has quoted a spokesman for the Democratic National Committee as having said Rajaratnam`s donations to the DNC and the Obama campaign will be donated to charity! But, the question is how much Rajaratnam really contributed to the Democratic Party, Hillary and Obama.
The LTTE has offered millions of US dollars to US officials as bribes. On August 21, 2006, United States Attorney Roslynn R. Mauskopf, Eastern District of New York, said a group of terror suspects arrested in the US including Murugesu Vinayagamoorthy, a senior LTTE supporter and Nachimuthu Socrates, an LTTE supporter in North America had attempted and conspired to bribe purported State Department officials and discussed the financial terms of the bribe including an up-front payment of one million US dollars, to have the LTTE removed from the US list of banned foreign terrorist organisations. In June 2009, Vinayagamoorthy and some others pleaded guilty to conspiracy to provide material support to the LTTE!
The Obama administration has softened its stand on the LTTE in spite of the US ban on the outfit and that CHANGE could not have happened due to LTTE lobbyists` power of persuasion alone. It behoves the US to investigate and find if some other LTTE financiers succeeded where Vinayagamoorthy et al failed as regards oiling palms. A probe into the donations terrorist fronts have made to political campaigns in the US might open a can of worms for some Sri Lanka bashers in the Obama administration.
The Democratic Party cannot wash its hands of Rajaratnam`s contributions simply by handing over an equivalent amount of money to charity. (One is reminded of French President Giscard d`Estaing`s predicament after receiving diamonds as gifts from `Emperor` Bokassa of Central Africa responsible for heinous crimes against the people of that country. When Bokassa was exposed and ousted, a red faced d`Estaing said he had donated 10,000 pounds sterling, being the value of diamonds the megalomaniac killer had showered on him, to a charity school in Bangui.)
How much Rajaratnam and others sympathetic to the LTTE have really contributed to political campaigns in the US we do not know. It could be thousands or millions of US dollars. It needs to be ascertained whether such gestures, irrespective of the actual amounts of funds, have had any influence on the policies of US politicians and the governments they represent.
Stockbrokers are supposed to know their clients (`Know Your Client` or KYC), as pointed out by The Sunday Island the other day. Similarly, the Democrats or any other political party anywhere in the world should know its contributors (Know Your Contributors or KYC)!
Did any Sri Lankan politician stand to gain from LTTE financiers` generosity? It has now been established that some military and police officers were in the LTTE`s pay. The government ought to launch an investigation into alleged financial deals some politicians have had with LTTE backers short of going on a witch-hunt.