By Chandeepa Wettasinghe
The Independent Association of Depositors of F&G Real Estate Company Ltd (F&G RECL) and Property Developers (Pvt.) Ltd (PD), both subsidiaries of the Ceylinco group, accused t he group’s past Chairman Lalith Kotelawala of attempting to fool the government and the people in view of the present political climate to take control of the companies once again.

Independent Association of Depositors of F&G RECL and PD officials from left: Secretary Mahinda Wijesuriya, President C. Caldera and Executive Committee Member Shanthi Wickremasinghe Pic by Pradeep Dilrukshana

“He is attempting to manipulate the new government’s good governance policy and use it as a cover and accuse the Rajapaksas to gain the people’s sympathy and get back in charge,” Independent Association of Depositors of F&G RECL and PD President C. Caldera alleged.

At a recent appearance on state television, Kotelawala had reportedly accused the Rajapaksa dynasty of stealing the Ceylinco group’s wealth and that he had no way to pay the depositors back.However, Caldera claimed that it was Kotelawala who had swindled the depositors prior to the collapse of the group and had close ties with the previous regime.

“It could also be true that the Rajapaksas stole from him but we are concerned with what happened to us. He robbed us in the past,” Caldera alleged.
Kotelawala’s narration has been that he had attempted to pay back the depositors’ money following the collapse but he was arrested and rendered helpless.
“In reality, he took refuge by orchestrating his own arrest and sending his wife to the UK. Despite her being a wanted figure, the authorities over there said that they had not been informed of such a situation,” Caldera further professed.He said that the depositors would now be left with nothing, as their properties were bought by Kotelawala with payments in the form of deposits, instead of cash.

Caldera pointed out that Golden Key Credit Card Co. Ltd in paper had deposits worth Rs.27 billion but during the fall it had just Rs.7 billion of funds.
He also said that rampant fraud was prevalent within F&G RECL, with deposits being reported at Rs.7 billion but with assets of Rs.4.5 billion, as properties were fraudulently valued.He accused Kotelawala and the board of directors of indulging in extravagance, giving themselves and top executives monthly salaries ranging from Rs.2 to 5 million.

During his interview, Kotelawala had reportedly said such unethical behaviour was conducted by his subordinates without his knowledge.
Caldera said that despite the Ceylinco group consisting of over 450 companies, the chairman bore ultimate responsibility.He further alleged Kotelawala of orchestrating t he assault of the Global Rubber Industries representatives, the second largest shareholder of Ceylinco Insurance PLC, last month.

“If he is treating his shareholders like that, what will be the plight of us, depositors?” he asked.Caldera said that despite such underhanded actions, Kotelawala has requested that he be reinstated as the Chairman to turnaround the group.He also pointed out t hat t he Finance Companies Act, amended in 2008, prohibits any individual over the age of 70 from holding a director post in a financial institution. Kotelawala turned 76 last October.

Meanwhile, Caldera said that in accordance with t he advice given by the Central Bank, his association has found a foreign investor named Sri Vidyathi, a woman of Indonesian origin residing in the UK, to revive the two property companies.

“The investor has shown us the proof of funds. She has US $ 1 billion in an HSBC London account. She has also given a letter of intent saying that she will commit US $ 55 million to repay the depositors and restart them,” Caldera claimed.He said that the proceedings of the Supreme Court case were halted due to the change of regime and the change of the Chief Justice and alleged that the Central Bank had previously been stalling their revival.

He also said that Policy Planning and Economic Affairs Deputy Minister Dr. Harsha de Silva’s plan to appoint a parliamentary committee to look into the Ceylinco debacle would be ineffective.“At least hold discussions between the Central Bank and each of the subsidiaries because each of them has different problems,” Caldera said.