Fresh Action Must be Initiated Against the Alleged Corruption of Mahinda Rajapaksa in the “Helping Hambantota” Affair.

avatar92by Vimukthi Yapa

The eleventh anniversary of the Indian Ocean tsunami came and went on December 26 last year with hardly a mention of Helping Hambantota, the scandal that, if not for the timely intervention of the Supreme Court, would have torpedoed the presidency of Mahinda Rajapaksa before it even began.

A review of the scandal during Rajapaksa’s term would arguably have called for more courage than even the most intrepid of Sri Lanka’s reporters could muster. After all, more than a dozen journalists including our own founding editor Lasantha Wickrematunge either perished or disappeared on Mr Rajapaksa’s watch, with Sri Lanka sinking to No. 165 out of 180 countries in the 2014 World Press Freedom Index published by Reporters Without Borders. Besides, as the ordeal of former Chief Justice Shirani Bandaranayake attests, any judge swimming in such treacherous waters would have to be very brave indeed.

All that, however, has now changed. President Maithripala Sirisena was elected largely on his repeated promises of good governance and there is no gainsaying that a new aura of freedom has swept not just the media but also the country at large. Sri Lankans can once more hold their heads high, not cowed by fear of the once dreaded white vans, stray bullets or spikes through the head. This government, in seeking to evict Chief Justice Mohan Silva, resorted not to threats of impeachment or prosecution on trumped-up charges, but to effete inducements in the form of plum diplomatic assignments, though hardly the stuff of ‘yaha-palanaya’.

Having been elected on a mandate to restore order and rule of law to the country, it behoves the new government to revisit the Helping Hambantota case and ensure that the injustice it entailed is at last put to right.


Helping Whom?

In brief, the facts of the case were as follows. The 2004 Boxing Day tsunami killed a staggering 35,322 people in Sri Lanka, rendering a further 516,000 homeless. In addition to this staggering human cost, some 100,000 homes and 65 per cent of the island’s fishing fleet were destroyed. It was, without question, the greatest calamity in our recorded history. The tragedy precipitated one of the largest and most generous outpourings of national and international aid on record. In all, international donors pledged upwards of US 2.4 billion US dollars in aid to Sri Lanka.

Almost as soon as disbursement of the funds commenced, however, there followed repeated and credible allegations of corruption. As a result, donors refrained from delivering fully on their pledges, and by end 2007, three years after the tragedy, only $1.2 billion had been disbursed. On 28 December that year the Sri Lanka branch of Transparency International claimed that almost half of even the $1.2 billion had mysteriously disappeared, adding that “There is no precise evidence to explain the missing sum of Rs 53,597,253,625 [i.e. Rs 53.6 billion].” Given the malevolence of the then regime, this astonishing news received barely a footnote in the local media.

The process of siphoning off tsunami aid began very early indeed, and among the most bizarre and egregious examples of abuse was the scandal that came to be known as Helping Hambantota. This revolved around donations of upwards of Rs 100 million handed over to then Prime Minister Mahinda Rajapaksa by generous donors in the first weeks after the tragedy. On 29 December 2004, just three days after disaster struck, Secretary to the President, W. J. S. Karunaratne, sent Circular No. PA/272 to the secretaries of all ministries informing them that “On the direction of the President, a special bank account [named ‘President’s Fund for Disaster Relief’] has been opened at the headquarters branch of People’s Bank to accept cash donations for relief operations that are now in progress.” He added emphatically, “you are kindly advised not to open any separate individual bank accounts to collect funds for relief operations.” The existence of this circular was never denied in the subsequent proceedings.

Notwithstanding that, however, just two days later, the Secretary to the Prime Minister opened a People’s Bank account named “Prime Minister’s Punarjeewana Fund”, No. 014100170136270, into which donations totalling some Rs 120 million were deposited by donors anxious to help. Although the Punarjeewana Fund was operated ex-officio by the prime minister’s secretary Lalith Weeratunga and additional secretary Gamini Senarath, it had been opened in direct contravention of Circular PA/272 and Financial Regulation 381, which stipulates that the prior approval of the Secretary to the Treasury must be obtained for such accounts.

In any event, just days later, an account titled Hambantota Tsunami Disaster Relief and Development Programme, also known as Helping Hambantota, No. 01-1237322-01, was opened at the Rajagiriya Branch of Standard Chartered Bank. The address given for the account was 166/A, Pangiriwatte Road, Mirihana, Nugegoda, which was the private residence of Mahinda Rajapaksa’s sister Gandini. The signatories to the account were private persons close to Mr. Rajapaksa.

On February 3, 2005 a sum of Rs 82,958,247.70 was transferred from the Punarjeewana Fund to the Standard Chartered Bank’s Helping Hambantota account by People’s Bank cheque No. 179128. A substantially lesser sum (Rs 28,363,135.04) was credited to the President’s Fund for Disaster Relief, the government’s official repository for tsunami aid.


Breaking News

The Sunday Leader got wind of and exposed the Helping Hambantota diversion in early July, 2005. Chief Justice Sarath Silva had sworn in Chandrika Kumaratunga for her second term on 22 December 1999, immediately after she won her second election just days after being seriously injured by an LTTE suicide bomb. Then, bizarrely, he swore her in again on 11 November 2000, at what was the end of her first six-year term. Now, in 2005, the CJ determined that her second six-year term had in fact commenced on 22 December 1999 and would therefore end a year early, in December that year. His old friend Mahinda Rajapaksa would be the UPFA’s presidential candidate in the election billed for November 2005.

The details of the Helping Hambantota scandal took the media by storm. The colossal sum of Rs 82,958,247.70 in tsunami aid being siphoned away from an irregular government account into a private account controlled by the presidential candidate’s family seriously jeopardized Mahinda Rajapaksa’s chances of victory. What is more, the Helping Hambantota account was irregular on multiple levels. It breached several Financial Regulations, including FR170, FR323 and FR321. It also breached Circular PA/272. It came as no surprise then, that on July 18, UNP parliamentarian Kabir Hashim made a complaint to the CID based on our reports, which contained remarkably detailed information including bank-account and cheque numbers. A CID investigation was duly launched, very likely with the concurrence of President Kumaratunga.

Amazingly, it was Mahinda Rajapaksa who went to court, claiming that the investigation breached his fundamental rights. Despite strenuous objections by Deputy Solicitor General Palitha Fernando, on September 28, the court (headed by Chief Justice Sarath Silva) stayed the CID from proceeding with the investigation. Then, after Rajapaksa had won the election and the case came up for hearing, on January 17, 2006 the Deputy Solicitor General meekly submitted that having considered “further material” the state had decided not to continue with the investigation. The nature of the “further material” was never disclosed.

The resulting judgement, from a bench presided over by Sarath Silva, was scathing. It found fault with the CID for investigating the case. Making no reference whatsoever to the blatant breach of the Financial Regulations of the government, the court decided that Rajapaksa’s fundamental rights had been breached by the investigation and ordered IGP Chandra Fernando, DIG Lionel Gunatilake, and MP Kabir Hashim to pay personally a sum of Rs 100,000 each to Rajapaksa by way of compensation. It further awarded Rajapaksa Rs 200,000 as costs.

(Chief) Justice Denied

Having been spurned by the Rajapaksa family following his retirement in June 2009, Sarath Silva became a strident critic of the former president, going so far as to apologize for his role in the ruling in a 2014 interview with the BBC Sinhala service. While his judgement exonerating Rajapaksa in the Helping Hambantota scandal, which was supported also by Justices Shirani Tilakawardena and N. E. Dissanayake, may well be correct in law, few people seem to be convinced of it. As pointed out above, Helping Hambantota breached numerous regulations and a criminal investigation was certainly warranted. The alleged embezzlement of tsunami aid occurred before Mahinda Rajapaksa became president, during a period in which he enjoyed no immunity. He is now open to the full force of the law. Much of the relevant evidence has been published in the newspapers already, and is available to the CID with little effort or fanfare.

What is more, the wrong done to IGP Fernando, DIG Gunatilake and Kabir Hashim must be righted. The judgement has implications far beyond the criminality or otherwise of the Helping Hambantota affair: it stabs at the very heart of the principle of the ‘whistle blower’, in this case Hashim, now Minister of Public Enterprise Development. When a member of the public, more so a member of parliament, becomes aware of a massive fraud involving public funds and goes to the police, the last thing he should expect is, rather than being lionised as a hero, to be victimised and fined by the highest court of the land.

It is time justice was done in the Helping Hambantota case. Indeed, given the ten-year period for which banks are required to keep cheques, there is no time to be lost. What is more, as recently as August 14, 2014, the bank in question in this case was fined $300 million by the New York Department of Financial Services for breach of money-laundering laws, and evidence of laundering in the present case too, may soon be erased. Lastly, a swift, thorough and fair investigation is the least we owe to the nations and individuals who gave so generously to rebuild Sri Lanka in the wake of the awful tragedy of December 26, 2004, and to the would-be beneficiaries from whom it was stolen.

Courtesy:The Sunday Leader