Spat between CB and FinMin delays Golden Key re-payments

By Nishel Fernando

A dispute between Central Bank and the Finance Ministry has delayed the re-payment of above Rs.10 million deposit holders of the failed Golden Key Credit Card Ltd (GKCCL), failing to honour a pledge made to the Supreme Court by the government, Mirror Business learns. 

The government pledged the depositors above Rs.10 million would be paid within a period of one year, from the date of settlement, which fell in August 2016. 
However, the government has failed to disburse the re-payments to a large number of deposit holders in above Rs.10 million category, which represents both pensioners as well as high-net worth individuals. 

Following the government’s failure to honour the Supreme Court undertaking, several depositors filed a contempt of court application against the Central Bank Governor, the Finance Minister, the Treasury Secretary and the members of the Monetary Board.

Speaking to Mirror Business, counsel for the depositors, attorney- at-law Hejaaz Hizbullah said that the Attorney General (AG) came forward after the filing of the contempt application and promised to pay the depositors within three months.

“However, the government has been extending the promised time period for the last 2 years,” he said.

According to the government sources, a dispute between the Central Bank and the Finance Ministry over the disposal of GKCCL assets has led to the delay in re-payments.

“There is a dispute between Finance Ministry and the Central Bank over the disposal of assets and to whom the money should go to,” the source said. 
“How can the government give an undertaking to the Supreme Court in a big case like this and then forget about it,” lamented Hizbullah.

Meanwhile, speaking to Mirror Business on the condition of anonymity, a Golden Key deposit holder charged that GKCCL board and the management are benefitting from the delay in payments and they prefer to drag the payments. 

“The Golden Key board is getting a salary every month and once the payments to deposit holders are concluded, they will also lose their jobs. Hence, they prefer it to drag it,” the deposit holder said.

“I have sold the only company I had and deposited all the funds in Golden Key, which is a pension for me. It’s been 12 years since we lost the money and the Supreme Court order was given 2 years ago to pay us. It’s ridiculous to pay some deposit holders while disregarding others,” the deposit holder added. 

GKCCL had deposit liabilities over Rs. 26 billion at the time of the company collapsed in 2009 to over 9000 depositors.