Chronicles of the ‘Great Bond Scam’

The COPE committee convened on Thursday to look into the controversial bond issue of the Central Bank. Officers of the Central Bank were also summoned for this meeting.

February 24,  2015

The Public Debt department decides to call for a bond issue of one billion rupees for a period of 30 years

February 26, 2015

Urgent meeting with the participation of Ministers Ravi Karunanayake, Kabir Hashim, and Chairman of the United National Party Malik Samarawickrama who was not an MP nor a Minister, Governor of the Central Bank Arjuna Mahendrna and other officials regarding the additional financial requirement for the payment of highway. contractors.

February 27, 2015

The first bond transaction after the appointment of the new governor takes place.

March 8, 2015

Details of the controversial CBSL bond issue come to light.

March 9,  2015
President intervenes and orders that a committee be appointed to inquire into alleged losses caused by the February 27, bond issue.

March 10,  2015

A three member committee appointed by the Prime Minister.

Names of Gamini Pitipana, Mahesh Kalugampitiya and Chandimal Mendis announced as committee members all of whom have strong affiliations with the UNP.

On the same day, News1st exposed the ownership of “Perpetual Treasuries” by “Perpetual Holdings” of which Arjun Aloysius who is the son-in-law of the governor is a significant share holder.

March 11, 2015

On the very next day, opposition lodges complaint at the Bribery Commission seeking investigation into alleged bond scam.

March 13, 2015

UNP Chairman Malik Samarawickrama confirms he was present at the meeting held on February 26, to discuss sate funding requirements. Tells News 1st, he attended the meeting as the adviser to the Prime Minister

March 16, 2015

CBSL Governor accepts failure to communicate to primary dealers, the CBSL’s intention to raise more funds through bond issue to News1st.

“I will take responsibility that we should have advertised 10 billion but we didn’t have that information in time” -Former CBSL.Governor

17th March 17,  2015

Prime Minister makes statement in Parliament on alleged bond scam and announces that Arjuna Mahendram is on leave.

March, 18 2015
Opposition stages protest opposite CBSL, demanding that investigation be expedited.

March 29, 2016

Another controversial bond issue takes place.

June 6, 2016

Committee on Public Enterprise informs the Auditor General to carry out investigations regarding the matter.

June 20, 2016

Former Chairman of the Ceylon Chamber of Commerce exposes the loss made in the second bond transaction to the public.

19th June 2016

Prime minister informs that Arjuna Mahenderan will not be reappointed until investigations into him completed by COPE.

June 24, 2016

Governor Arjuna Mahendran hold meeting at CB, meets all deputy governors and says that he will be on leave.

June 29,  2016

President says a new governor will be appointed.President arrives at the Central Bank to hold a critical meeting the same evening.

June 30, 2016

President Appoints Dr. Indrajit Coomaraswamy new governor of the Central Bank

July 4, 2016

New governor of Central Bank takes oaths before President promising to uphold the integrity of the Central Bank of Sri Lanka.

In an article published in The Island on Friday under the headline Mahendran ignored Public Debt Dept warnings, went ahead with bond sales, officials tell COPE“, it was highlighted quoting a senior member of COPE, a group of Central Bank (CB) officials yesterday informed the Committee on Public Enterprises (COPE) that Central Bank Governor Arjuna Mahendran had claimed he acted on the instructions of Prime Minister Ranil Wickremesinghe as regards the controversial bond issue.

The article goes on to note that The UNP members of the COPE had sought to exonerate Mahendran and to shift the blame to the officials. And the UNP MPs had maintained that the top CB officials, too should be held responsible for the massive loss caused by the bond deal because they had cooperated with Mahendran.

Quoting another member of COPE, The Island reports that the UNP MPs’ attempt to absolve Mahendran of the responsibility for the controversial bond auction, on the grounds that it had been consequent to a policy decision by the government, was countered by the Opposition MPs with the help of presentations made by the CB officials.

The Central Bank officials had said that the officials insisted that there had been no such policy decision because the Monetary Board had not given approval for Mahendran’s action as regards the bond deal at issue.

However, the Central Bank officials had responded that Mahendran had proceeded with the controversial bond sales in spite of severe warnings from the Public Debt Department of the Central Bank, COPE members said.

The officials had said that the governor had informed the Monetary Board of his move, only after he had conducted the auction.

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