Colombo bourse needs a full revamp: Dayasiri

7 November 2011 08:25 am Views - {{hitsCtrl.values.hits}} 28 Bookmark

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UNP Kurunegala District parliamentarian Dayasiri Jayasekara speaking to the Daily Mirror online today said that the stock market is run by a mafia with black money. “The stock exchange is dominated by a few people who are investing their illegal money into the system and at the end of it all they make their millions and the small timers are left wondering what happened to all their hard earned money,” he said.He added that these few players ruin the reputation of the genuine investors who are considered 'big players' in the market and are investing hard earned money. In a revealing interview with Daily Mirror online Jayasekara revealed that it was the few players together with top officials at the SEC and the Central Bank who were involved in this fraudulent racket.

The recent collapse in the stock market and the continued experimenting by the SEC has resulted in a major collapse in the Sri Lankan stock market with speculation being the norm within the CSE. The Director General of the CSE was removed last week and “promoted” to an advisor to the Finance Ministry in the wake of the continuous downturn within the market. “The stock exchange had in the past over 600,000 accounts of which a majority were of small time investors looking to harness their earning through the Stock market, today the operational accounts within the CSE has dipped to a mere 200,000, in all other countries it is the small timers who drive the market therefore, the stock market is seen as a perfect indicator of the Economy and investor sentiments of the country, however, in the case of Sri Lanka none of that can be done because a very few individuals run the whole show,” he said.

Making a sweeping allegation against many of the big players in the market Jayasekara said, “There have been statements by those at the top that a number of foreign investors have entered the market. I challenge the SEC to reveal one genuine investor or company that has come forward to invest in the CSE. What they call foreign investors are all Sri Lankans who send in their black money to Deutche Bank or to Grindlays, in turn these banks open accounts with the CSE and invest all of this black money back into the market, and that is what these people call ‘foreign investors’,” he said.

Jayasekara further went on to point out that one of the main reasons for the fall of the market was due to the interference of the Security Exchange Commission (SEC). “The SEC got involved with the free flow of things at the start and made a mess of it. The Price Band which was brought in as an experiment firstly affected the small timers. If you take the Stock Grain Elevators the price band was brought in after billions were made by the big timers who pushed the stock, then they had a benevolent buyer in the form of the EPF and ETF and once the price band came in the small timers who put their life savings into the market and believed the share was rising for some solid reason and bought the stock were left destitute. Also the SEC brought in regulations to the effect that margin accounts which many small timers rely on were to be closed by March 31. So these small timers sell all their shares at a very low rate which in turn is bought by the sharks,” he said.

He went on to allege that the hierarchy of the SEC have turned a blind eye to the insider trading that goes on day in and day out at the CSE. “They have appointed a chairwoman who has no clue about the workings of the market and these few individuals together with a premier blue chip company and a top official of the Central Bank run the show, the chairwoman is kept happy with a few foreign trips and a speech at some function while these few individuals are making millions at the expense of those poor investors,” he said.

He further went on to add that he is in the possession of all the details regarding the money launderers and the big time investors who play the market at the expense of the innocent public and he will reveal all these details in parliament in due course. (Hafeel Farisz)