Treasury Bonds Auction Probe.
Former Governor of the Central Bank of Sri Lanka Arjuna Mahendran told the Presidential Commission of Inquiry (PCoI) probing the Treasury Bonds fraud, yesterday (10), that he took over the Central Bank, commenced Treasury Bonds auction and took various decisions regarding the Employees’ Provident Fund (EPF) and other matters, according to the instructions given to him by Prime Minister Ranil Wickremesinghe, under whom the Central Bank was.
Therefore, the former Governor said, the Prime Minister should be summoned and inquiries made from him.
Mahendran made this statement when Senior Additional Solicitor General (SASG), President’s Counsel Dappula de Livera cross examined him.
Not once, but three or four times, he said that there was no point in asking him these questions but, the Prime Minister should be questioned and the answers obtained from him.
The SASG said, he suggests that the Direct Placement System, which was in operation at the Central Bank, prior to Mahendran being appointed……to the post of Governor, was suspended immediately after he was appointed and the Treasury Bond Auction System was commenced in order to provide unlimited profits for his son-in-law Arjun Aloysius’ company. Mahendran rejected the suggestion and said that it was carried out on the instructions of the Prime Minister.
Asked whether the EPF was deprived of the opportunity to participate in Auctions, as a Primary Dealer, in order to provide room for his son-in-law Aloysius’ company to earn unlimited profits, the former Governor said that that too was done on a request made by the Prime Minister.
When the former Governor was asked whether the authority to work as the head in charge of the EPF treasury affairs was given to Saman Kumara, an activist of the National Employees Association Trade Union and someone who had no relevant qualifications or experience whatsoever, was given by him, he replied that this individual was given the opportunity since he was a powerful United National Party activist and had close ties with the Prime Minister, Finance Minister and Ministers Kabir Hasheem and Malik Samarawickrema.
Replying to a question on whether the former Governor had worked, not according to his own claim, or based on his power of authority, or according to the established rules and regulations of the Central Bank, but based on the guidance and instructions of the Prime Minister, Mahendran said that the Prime Minister is in charge of the Central Bank.
When the former governor was asked whether he was aware of the fact that at a meeting summoned by the then Minister Ravi Karunanayake, on 28 March 2016, at the Finance Ministry, all three Chairmen of the State Banks had been called in and they were told that at the auction to be held on the following day, the 29, to submit bids at low prices and the rates too were informed to them by the Minister, his reply was that he knew nothing about it.
When an inquiry was made whether he was aware that on a previous date, these heads of the State Banks and deputy heads had confirmed this under oath to the Commission, the former Governor of the Central Bank said that he had got to know of it through the media, especially newspapers.