"Sri Lanka has been named as a high risk country for investment"

President should have taken quicker and stronger action than this in connection with the Bond Scam
Barring the two frauds under this Govt. no bond scam has taken place in Sri Lanka since 1997 
PM’s unfounded allegation about scams will erode investor confidence in local bond sales
President dissolved P’ment in 2015 to protect PM and UNP
Nobody can put the blame on JO for mayhem in P’ment
The Government, which the President represents, is under fire

Joint Opposition MP Bandula Gunawardane speaking to Dailymirror about the implications of the controversial bond scam and the seriousness of Prime Minister Ranil Wickremesinghe’s allegation regarding similar frauds in the past. Following are excerpts of the interview done with Gunawardane.

QYou engaged the Central Bank Governor on the bond scam. What is next?

The Joint Opposition made the most rigorous campaign against the controversial bond transaction ever since it took place on February 27, 2015. First we attempted to get the Central Bank Governor Arjuna Mahendran removed as he is the principal person responsible for the scam. Then we wanted to take punitive action against all those who are responsible. Unfortunately it didn’t happen. The COPE chaired by former Minister D.E.W. Gunasekara during the previous Parliament conducted the first in-depth investigation into this bond issue. All details were found. Also, the wrongdoers were identified. Unfortunately, Parliament was dissolved a day prior to the submission of the report. It was done in order to save the United National Party (UNP) and its leadership. President Maithripala Sirisena happened to dissolve Parliament. Once again, on March 27, 2016, the second bond scam took place. The chairmen of the three main state banks of Sri Lanka- Bank of Ceylon, National Savings Bank and the People’s Bank- testified and implicated the name of then Finance Minister Ravi Karunanayake who asked the banking authorities to make low bids in the bond sale.   

In fact, we insisted right from the beginning that legal action should be instituted against all those responsible. We demanded the arrest of Mr. Mahendran upon his return to the country, at the airport itself

In fact, we insisted right from the beginning that legal action should be instituted against all those responsible. We demanded the arrest of Mr. Mahendran upon his return to the country, at the airport itself.   

Anika Wijesuriya who gave evidence against Mr.Karunanayake had to flee the country for her safety.   
QThe Prime Minister in his statement said that there were similar frauds during 2008 and 2014. You were part of that Government. What is your response to this allegation? 

I, along with current President Maithripala Sirisena, was part of that Government. We are collectively bound to the decisions taken by that Government. Both of us are held responsible for this allegation by the Prime Minister in that sense. I can vouch that barring the two frauds committed under the present rule no bond scam has taken place since 1997. Bonds are traded in the primary and secondary markets. In case of a fraud, the bond market itself sends an alarming signal to those involved in trading. It happens virtually. If a stranger tries to steal a vehicle, its alarm system will start ringing. No stranger can drive a vehicle away with an alarm system.   

During the previous UNP regimes, we came under attacks by police personnel who came in the guise of goons

So, nobody can stake a claim that he is the one who discovered this fraud first. It is untrue. The bond market itself emitted signals about fraudulent activities happening in the process.   

Treasury Bills and Treasury Bonds are unique instruments used by the Government to raise money for its requirements. Investors trust them fully in putting their money on the ground. There is a risk involved in investing in other sectors. Yet, in the investment of money in Government securities, there is less. When such transactions are termed unlawful by the Prime Minister, no investor will come forward to invest in them. The bond market of Sri Lanka is in grave jeopardy today because of the Prime Minister’s statement made amid din in the House last week.   

Since Independence, this is the most controversial statement to be made by a Prime Minister. The Prime Minister said Rs.4702 billion were raised through bonds. The Prime Minister said it was done unlawfully without the approval of the Central Bank’s Monetary Board. These bonds, issued at that time, are still traded in the market. Investors will have second thoughts in investing in Sri Lanka’s bond market hereafter. The international media covered this. It reflects badly on Sri Lanka.  

Foreigners will tend to withdraw their money invested in bonds here. Secondly, Sri Lanka Treasury Bonds will yield less in the future because investors have lost confidence. Sri Lanka has been already named as a high risk country for investment. This is our country. We have to protect it. If the financial market collapses, no one will be able to resurrect it.   

QThe Prime Minister said an investigation should be conducted into the bond transactions during that period. What is your view?

We are asking him to conduct any investigation within a matter of a few days. The Stock Exchange started deteriorating in 2015. The Government is still unable to put it on track. It collapsed because Mr. Karunanayake as the Finance Minister started a witch-hunt on the private sector. He introduced a super gain tax with retrospective effect. He dubbed some private sector people as fraudsters. The Government got as much as Rs.50 billion from the private sector by way of super gain tax. It is twice the size of money invested for the construction of the Mattala Airport.

Nobody can put the blame on the Joint Opposition for mayhem created in Parliament the other day. We did not go to Parliament to listen to a mere statement by the Prime Minister

   
QWhat do you think of the President’s present reaction to the bond scam?

The President should have opted for quicker and stronger actions than these. The Government, which the President represents, is under fire. He has a greater responsibility regarding these issues. He should summon the officials of Central Bank including the Governor. It should be his duty. He should also summon the Auditor General. After that, this matter should be discussed. Otherwise, it will be difficult for the Government to make borrowings to run its affairs.   

In the history of Sri Lanka, we have heard that such financial frauds even led to the assassination of political leaders. There is unconfirmed evidence that frauds related to shipping transactions led to the assassination of S.W.R.D. Bandaranaike. This is an unconfirmed report, though. Therefore, we ask not to allow those responsible for the bond fraud to be at large. They have to be arrested. It is dangerous for them to be allowed to remain unshackled. 

The bond market of Sri Lanka is in grave jeopardy today because of the Prime Minister’s statement made amid din in the House last week

  
Nobody can put the blame on the Joint Opposition for mayhem created in Parliament the other day. We did not go to Parliament to listen to a mere statement by the Prime Minister. Unless we are given the opportunity to make our voice heard, we will have to resort to other methods to drive home our point of view. We do not have the opposition leader’s post. Also, we do not have the post of the Chief Opposition Whip. We only have Mr. Dinesh Gunawardane to represent us in the party leaders’ meetings. We represent the genuine opposition of the people. We only demonstrated in the Well of the House using posters. The fracas took place after they confronted us and snatched away our posters. The Speaker could have avoided it. He should have adjourned the session. One MP collapsed on the floor of the Well. There were fisticuffs. But, The Speaker is silent. People respect the Supreme Court because lawyers do not involve themselves in physical brawls. They are engaged in enlightened legal arguments with each other. If all get involved in fisticuffs, people will not respect even the court. This is the type of conduct in the place where law is practiced. Then, the conduct in the place where law is made should be even more exemplary.   

It is unbecoming of any Prime Minister in the world to shout slogans in the House along with his MPs.   
QYet, the Joint Opposition only stormed into the Well of the House first. What do you say about that?

It happens when we are not given an opportunity at all to air our grievances. In the past, TNA MP M.K. Sivajilingam removed his shirt and protested. UNP MP T. Maheswaran did it. Also, there were floral wreaths smuggled into the House.  

Investors will have second thoughts in investing in Sri Lanka’s bond market hereafter. The international media covered this. It reflects badly on Sri Lanka

During the previous UNP regimes, we came under attacks by police personnel who came in the guise of goons. We faced such a situation when proceeding towards Parliament in a bus. This is a bad example anyway.