Crucial court verdict today on West Asian secret account of VVIP’s son

  • Ruling on case involving half a billion dollars seen as  opening the door to full-scale probe on massive corrupt deals
  • While Ukraine goes slow on MiG probe, top agencies help Sri Lanka make breakthrough; new twists in Avant Garde story
  • Full two-day parliamentary debate on Geneva issue; minister says ‘domestic inquiry with foreign participation’

China_catch_me_if_you_canA landmark event in a West Asian capital will play out today and it will send shockwaves around Sri Lanka. This is when a court there hears a case where lawyers for Sri Lanka Government are seeking an order to freeze nearly a half a billion dollars in a bank account. It has been established that this account is in the name of a young politician, the son of a former VVIP. It has also been established that there was well over a billion US dollars when information was first received about this account. The politician in question had transferred a big part of the funds to a bank in an eastern European country. Reports that a close relative helped in the transfer of funds there are now being probed.

In the event the Government’s efforts do not prove to be successful today, an official source said, “We are hopeful but have other options too”. He added “we cannot discuss them now.” The West Asian country in question has rigid banking laws to protect customers but it is receptive to initiating action, if proof is provided that such funds have been obtained through illegal and criminal means.

When the case was taken up the previous Thursday, the Judge who heard submissions summoned that country’s Attorney General. He had sought his opinion whilst listing the case for today. If the court, which sits on a Sunday, being an Islamic country, agrees to the Sri Lanka Government’s request, the move would be viewed by Government leaders not only as a major victory in their anti-corruption drive.

More importantly, that would come as conclusive proof that the country’s wealth has been unabashedly looted by a handful in the previous administration and the monies deposited in foreign banks. Lawyers representing the Sri Lanka Government have been “adequately” briefed how the monies in question have been amassed. Government leaders believe the evidence they have placed before court is sufficient grounds to first freeze funds remaining in the account.

This is to buy itself time to prevent further draining of monies and also to obtain time to produce more evidence that criminal acts were committed in amassing those funds. A source familiar with these developments said, “The breakthrough we have achieved is only a tip of the iceberg. There are others who have similarly plundered the State wealth and amassed vast sums of money in foreign countries. We are on their tracks but for obvious reasons more cannot be said.”

US extends full support
A close associate of the VVIP — who was himself under investigation — as reported earlier in the Sunday Times is learnt to have revealed the existence of the undisclosed account. Independent confirmation has also come from United States investigative agencies which wield considerable clout in West Asian countries. They are learnt to be monitoring developments. Among them are the Federal Bureau of Investigation (FBI) and the Department of Justice (DoJ). Another case where the US Department of Justice has provided detailed information is about the sale of the new Sri Lanka Embassy premises at 2148, Wyoming Avenue, NW, Washington DC and the purchase of a new building at 3025 Whitehaven Street. It is alleged that a top Sri Lankan diplomat there made fat commissions on the transaction.

The cost was in the region of US$ six million plus and then another US$ one million to convert eight bedrooms in the newpremises into offices. Now, the Government is unsure what to do with the old premises. It is said to be one of the biggest diplomatic scandals in the US in recent times. Documents to confirm the allegation have been given to the Government. The diplomat had reportedly placed the blame on the embassy’s accountant who has in turn accused this top diplomat of embezzlement. US Secretary of State John Kerry, during a visit to Colombo in May last year, assured Sri Lanka that President Obama’s administration would extend full support to trace hidden assets of leaders of the previous Government. Since then agents from different agencies have been visiting Sri Lanka frequently to interact with their local counterparts. During his visit to New York to attend the 70th anniversary sessions of the UN General Assembly, President Sirisena thanked US authorities for all their support and co-operation.

Signals that the US was strongly behind Sirisena were made even clearer when he visited New York. It was Samantha Power, US Permanent Representative to the UN, who saw to it that President Sirisena sat on President Obama’s table when the US leader hosted a lunch for visiting heads of State and/or Government. Originally, a seat next to Obama had been set apart. However, that went to Ukranian President Petro Poroshenko. Yet, Sirisena was only one seat away from Obama, separated on his right flank by Poroshenko. Others in the table included UN Secretary General Ban-ki-Moon, South African President Jacob Zuma, Russian President Vladimir Putin, South Korean President Park Geun-hye, French President Francois Hollande and Chinese President Xi Jinping. That was not all. President Obama chaired a meeting of the Global Peace Operations Initiative (GPOI) at the UN Headquarters. As he descended the podium after his speech whilst others watched, Obama walked up to where the Sri Lanka delegation was seated. Then, he made it a point to shake Sirisena’s hands before leaving. Diplomatically, at the highest level of the US administration, there was the message that the US was with Sirisena.

GPOI is a U.S. Government-funded security assistance programme intended to enhance international capacity to effectively conduct United Nations and regional peace support operations (PSOs) by building partner country capabilities to train and sustain peacekeeping proficiencies; increasing the number of capable military troops and formed police units (FPUs) available for deployment; and facilitating the preparation, logistical support and deployment of military units and FPUs to PSOs. With the separatist war over more than six years ago, Sri Lanka joining the US initiative is to find opportunities for local troops and police officers to serve as peacekeepers in trouble spots of the word. That would certainly be factored in when the Government takes a close look at downsizing the military after examining the threat scenarios. That, of course, would be a time-consuming process and is expected to include structural changes.

Government sources said help from the United States also extended to other countries where the US has strong leverage. One case in question is the probe by the Financial Crimes Investigation Division (FCID) into the procurement of MiG-27 fighter jets from Ukraine. As a prelude to extended investigations in Ukraine, Foreign Minister Mangala Samaraweera invited that country’s Ambassador Oleksander Shivchenko Colombo for talks in April. Sri Lanka had been then assured of the Kiev Government’s cooperation and dates were arranged for a team to travel there. Thereafter, however, repeated appeals for confirmation did not materialise. Calls from the investigation team to the Ukranian Embassy in New Delhi for fresh dates for the visit went unanswered. Foreign Minister Samaraweera who was in New Delhi for the visit there by Prime Minister Ranil Wickremesinghe, a Foreign Ministry source said, spoke on the phone with the Ukranian Embassy’s number two. He had only said that the matter was still under consideration by his Government in Kiev. An FCID official said Minister Samaraweera also wrote to his Ukranian counterpart but “it was not even acknowledged.” The official said that they were now liaising with different US agencies which were helping them. In fact, they have already made available details of how the moneys were routed from a bank in Colombo for the purchase.

Envoys to be questioned
These developments came as a delegation which included Senior DIG Ravi Waidyalankara, head of the FCID, were to London this week to study the working of the Serious Frauds Office (SFO) there. The Government wants to set up an SFO in Sri Lanka to succeed the FCID and legislation for this purpose would be presented in Parliament before the end of the year. The FCID has broadened the scope of its investigations into newer areas. It wants to question ambassadors and high commissioners who served under the previous Rajapaksa administration. This is to find answers to questions on who paid for their tickets to come to Sri Lanka ahead the January 8 presidential election. Most of these envoys who were told to return to Colombo had been engaged in the polls campaign of former President Mahinda Rajapaksa. One or two remained in their home.

Whilst some said they had private accommodation, others had demanded accommodation from the Foreign Ministry and were put up in Colombo’s star class hotels. In addition, the Foreign Ministry had made available official vehicles with drivers for their use in the campaign. At least in one instance, a Sri Lankan envoy had protested that a smaller hotel was not suitable for him. He demanded that he be shifted to a luxury hotel in Colombo. FCID detectives want to determine who paid for the air tickets, hotel accommodation and for the vehicles together with drivers. The idea behind the investigation is to ascertain how much of public funds were used. The former Foreign Secretary, Kshenuka Senewiratne, now Sri Lanka Ambassador to Thailand, is also to be questioned in this regard. As Foreign Secretary she is the Chief Accounting Officer of the Ministry. Detectives will also ask her on whose instructions she directed the Sri Lankan envoys to return to Sri Lanka. Also to be questioned in this regard is former External Affairs Minister G.L. Peiris.

A request for Senewiratne to return to Colombo for her statement to be recorded will not be made until all envoys are questioned. Moreover, President Sirisena is also to undertake a state visit to Thailand on November 3. Sirisena is also billed to leave for Paris for a global event and later to Malta for the Commonwealth Heads of Government Meeting (CHOGM). He is now the chair -in-office.

Avant Garde case: More questions
A more explosive issue was to surface at Wednesday’s weekly ministerial meeting. Ministers Patali Champika Ranawaka and Rajitha Senaratne were to raise issue over a consignment of weapons that was headed for Avante Garde Maritime Services Limited (AGMSL) in one of their vessely. They alleged that though it was claimed that there were no weapons on board, they had information that there indeed were weapons on board. Minister Ranawaka was more livid. He was to berate some of his ministerial colleagues, who, he said were supporting the security firm in question. He claimed he was even frightened to raise issues at the ministerial meeting since all such things were reaching the ears of the owners who were “filthily rich”.

The issue became clearer only at Friday’s meeting of the National Security Council (NSC). Vice Admiral Ravindra Wijegunaratne gave a detailed presentation of the events. Among those taking part were President Sirisena and Prime Minister Ranil Wickremesinghe.

It transpired that Avant Garde had written to the Ministry of Defence on September 28 giving notice of the arrival of the vessel. It had listed the number of weapons and claimed they bore registration with the Government of Sri Lanka. For some reason or the other, the letter had remained in the MoD and no action has been pursued. However, the Navy which conducted checks after boarding the vessel when it entered Sri Lanka’s territorial waters, Vice Admiral Wijegunaratne told the NSC, found that some of the weapons were not registered. The vessel is now in Navy’s custody. Creating confusion was a letter dated October 6 signed by D.M.S. Dissanayake, Senior Assistant Secretary in the Ministry of Defence as the officer in charge of Civil Security. It had called upon the Commander of the Navy to release the vessel. He was perhaps acting somewhat belatedly on the earlier letter sent to the MoD by Avante Garde. This letter had been released to sections of the media to suggest that the vessel had been cleared. However, the Navy did not carry out the request in the wake of its findings. Dissanayake was earlier number two to Damayanthi Jayaratne who was then in charge of civil security matters in the MoD and has since been transferred out.

There was a suggestion at the NSC meeting that the Navy conduct an inquiry and files action against those involved if there were violations of the law. Vice Admiral Wijegunaratne politely declined the request and said the Navy was unable to proceed with any court action. This was on the grounds that the matter was the responsibility of the Police. The Navy will now keep the vessel under detention whilst a probe is conducted.

muslimsThis was confirmed by official Navy spokesperson Commander Indika Silva. He told the Sunday Times “‘the vessel in question has not been released as yet. The Navy commander has ordered an inquiry into the matter. Until the investigations are concluded the vessel will not be released. Once the report is handed over to the Navy commander it will be forwarded to the Defence Ministry which will take a decision on the matter.” This is whilst a ministerial team headed by President Sirisena will meet next week to identify ten different ‘big time’ cases to be investigated. As revealed in these columns, two such investigations relate to Avant Garde and the RADA (Reconstruction and Development Agency).

The story of the vessel carrying weapons had broken when official Government spokesperson and Health Minister Rajitha Senaratne addressed the regular post-Cabinet news conference on Thursday. Commenting on the episode, he said, “The President has given orders to take all legal action. They have (the vessel operators) said upon entering Sri Lankan waters that they did not have weapons. But they did.”

The latest incident comes amidst public criticism that despite repeated assurances to the public during the presidential election campaign that those responsible for corrupt activity would be dealt with, little action has been taken. Both the CID and the FCID have also come under public criticism on the grounds that they were allegedly succumbing to political pressure or have not successfully concluded most cases except a handful. The same sentiments are being expressed by even sections of the Government. They complain that they cannot get back to their electorates due to mounting criticism or raise issues in Parliament for fear of violating the Whip. That it has come in the backdrop of mounting living costs has added to their woes. A Government MP who did not wish to be identified lamented “all these measures are making us unpopular and could become fertile grounds for our opponents to exploit.”

President Sirisena, no doubt, has won the acclaim of the United States and its allies even more after the UN visit. However, the lack of a cohesive communications strategy to explain to the public his own viewpoint or studied stance on key issues or take corrective measures, there is little doubt, is hurting him and his Government. One such area is the mounting incidence of crime — child rape, murder, robbery, internet crimes and even the functioning of judicial institutions. A sociologist conducting a study on the subject declared, “Every night the public are given a large dose of all sordid events on television.

This is in marked contrast to the previous regime which featured leaders of the previous Government at different development projects or attempted to focus on other positive activity.” He cited the rape and murder of four-year-old Seya Sadewmi at Kotadeniyawa. “The official Police spokesperson has been accusing different people at different times and later retracting what he says. So it is first a trial by the spokesperson whilst senior officers make different statements to cover up issues,” he said. He added that until now the Government has not made its position known to the people in all these issues raising fears that things could lead to widespread fear psychosis that existed in the years before.

Expenditure over President’s house
Other than that, President Sirisena has also come in for substantial public criticism over some issues. One is the construction of his official bungalow at Paget Road by merging two houses. Supplementary allocations amounting to over Rs 780 million had been made to the office of the President between May and September this year. Of this amount, around Rs. 200 million went for the renovation of an official residence for him on Paget Road, documents tabled in Parliament revealed this week.

The monies were paid out from the Project of Budgetary Support Services and Contingent Liabilities’ of the Department of National Budget. In May, more than Rs. 96.3 million was provided for the rehabilitation and improvement of the residence of the President at C 61 and C 62 Paget Road, Colombo 05, while another Rs. 84.2 million was provided the same month for the construction of buildings and structures of the residence of the President at the same address.

On the other hand, it would have cost much less if the Janadipathi Mandiraya or the President’s House was renovated and Sirisena moved in there. It has been used as the official residence of Presidents and only minimal expenditure would have been incurred for repairs. In addition, in May a further Rs. 70.6 million was made as a supplementary allocation to purchase one BMW limousine and 12 BMW 1200 motorcycles for the President’s security division. However, the President’s Office said in a statement that the cost was due to the need to merge the two houses to provide for the needs of the President and that running expenses such as water bills for the President’s House in the Fort amounted to Rs. 15 million a month. The statement said that the orders for the purchase of these vehicles were placed by the Rajapaksa administration. Yet, in August this year, a supplementary allocation of Rs. 52. million was made to purchase two dummy vehicles at a cost of Rs. 26 million each to be used as security vehicles for the President.

Questions come to the fore in the light of assertions Sirisena made during the presidential election campaign and thereafter. He told the national television network Sri Lanka Rupavahini on January 31st that there were several President’s Houses and he would not be using them except for state functions. He made clear that he did not intend to use the President’s House in Fort, other than for State functions, whilst those in other parts of the country too would be used for state functions. On December 8 last year he told the National Lawyers General Convention at the Mount Lavinia Hotel that “I know what is happening in the air-conditioned rooms at ‘Temple Trees’ very well. Ranil Wickremesinghe stayed there for some time as the Prime Minister. But the ‘Temple Tree’s that exists today is not the same as the one then. During the past five/six years hundreds of millions (koati gaanak) were spent only on ‘Temple Trees’. The physical changes made were immense. It has been converted into a major luxury palace now.

“The Presidential Residence in Kandy is the same. Millions have been spent to make big buildings. That is also like a big palace. Millions were spent on the Nuwara Eliya Presidential Residence too, during the last few years. Changes were made on it and converted into a palace fit for a king. A palace was also built in Embilipitiya spending millions of rupees. To do this public resources and money of the innocent public were used. Whose money is this? Isn’t this the money of the public?”

Truth and Reconciliation Commission
PulidevanFor both Sirisena and Prime Minister Wickremesinghe, amidst domestic issues, the twin priorities appear to be issues in the aftermath of the OISL report on alleged war crimes in Sri Lanka and matters relating to the economy. “Our immediate priority now is to start the consultative process. That will cover representatives of political parties, civil society and victims of the war,” Foreign Minister Samaraweera told the Sunday Times. He said the Government would go to them with the outlines of a “basic structure” and build on it. He said the Government hoped to complete the process by January next year.

The minister said a team would leave for South Africa in the coming week to study that country’s own Truth and Reconciliation Commission (TRC). This is a prelude to the setting up of a TRC in Sri Lanka together with a Compassionate Council comprising respected religious leaders. A permanent office for missing persons, he said, would be set up. The contours of this office are being worked out in consultation with the International Committee of the Red Cross (ICRC). The Foreign Minister said that in all likelihood legislation for this office would be presented in Parliament ahead of the budget on November 20.

Minister Samaraweera said the investigation mechanism would be “domestic” with “foreign participation.” Whilst this would make it a credible process, he said, there had been many instances where there had been foreign involvement in local investigations. The assassination of the late S.W.R.D. Bandaranaike was probed by a team of foreign judges. There were foreign investigators in the form of those from the New Scotland Yard to probe the killing of Lalith Athulathmudali, though ironically, the British sleuths were accused of covering up for the R. Premadasa regime.

The OISL report will be debated in Parliament on October 21 and 22. Sittings will begin at 9.30 am to enable a two-day-long debate. Yesterday, a group of opposition political parties decided to carry out a campaign against Government’s acceptance of the report by co-sponsoring it. The parties are Mahajana Eksath Peramuna (Dinesh Gunawardena), Communist Party (D.E.W. Gunasekera), Lanka Sama Samaja Party (Tissa Vitharana), National Freedom Front (Wimal Weerawansa), Democratic Left front (Vasudeva Nanayakkara), Sri Lanka Mahajana Pakshaya (Wasantha Navaratne) and Desha Vimukthi Peramuna (N. Podiappuhamy). MEP leader Dinesh Gunawardena said yesterday the first seminar to “educate” the public would be held in Colombo on October 19.

Changes at the Foreign Ministry
Daham-Sirisena1-640x400Foreign Minister Samaraweera also declared that there would be a restructuring in the Ministry of Foreign Affairs in consultation with President Sirisena and Prime Minister Wickremesinghe. The move is expected to see changes in the positions held by some controversial incumbents — an issue which has raised serious concerns for Premier Wickremesinghe. The Premier is set to meet Samaraweera to discuss these issues particularly in the aftermath of questionable conduct by a Sri Lankan diplomat in Geneva and officials in the Foreign Ministry. Wickremesinghe is insistent that action should be initiated against them. He is keen to ensure that his Government’s economic development plans in the coming years are backed by efficient officials in the Foreign Ministry including those serving abroad. This is particularly in the light of his successful visit to Japan and an impending official visit to Singapore, both closely related to his economic development programme. Some of the measures on the economic front are to be spelt out by Finance Minister Ravi Karunanayake when he presents the first budget of the Government. A government source said relief measures would be included.

A successful verdict in favour of Sri Lanka in today’s case in the West Asian capital would no doubt be a signal honour for President Sirisena and other Government leaders engaged in the initiative. There is no gainsaying that there is an urgent need to address other mounting domestic issues. More so when there is still public confidence in the Government and the credibility of leaders of the previous administration have crumbled due to their misdeeds.