Activists cry foul over attempts to reinstate Lankaputhra Chairman

Tuesday, 27 September 2016 00:30 -     - {{hitsCtrl.values.hits}}

By Charumini de Silva

A new chapter of the saga at State-owned Lankaputhra Development Bank (LDB) has begun with critics contending the Central Bank is working ‘beyond its limits’ to reappoint former Chairman Lasantha Goonawardena.

The Anti Corruption Front (AFC), employees and Ceylon Bank Employees Union (CBEU) vehemently oppose the reappointment of Goonawardena insisting that he has continued to violate the Banking Act and the directives of the Central Bank.01-003

According to a statement by the AFC despite the Monetary Board relaying its decision in a letter dated 2 September to LDB as per the advice given by the Attorney General, directing that Goonewardena cannot hold the position of Chairman with effect from 24 March 2016 — it appears that he has remained involved in Executive functions of LDB including employee appointments, transfers and other activities of the bank.

As per the CBSL letter dated 24 March 2016 the banking regulator has found Goonewardena had violated Section 77 of the Banking Act.

“If section 77 is violated, as per the section 79 (2) of the Act, such person should be convicted by a Summary Trial before a Magistrate and imprisoned for a period and pay a fine not exceeding Rs.1 million. However, without taking any of these measures, the CBSL is attempting to consider the reappointment of Goonawardena,” they claimed.

On 2 June 2016 the CBSL has requested Goonewardena to make further submissions on his appeal and it has been noted that he had made an appeal to banking regulator on 05 June 2016, which is two months after the CBSL order for him to step down. However, according to the section 42 (6) of the Banking Act, appeal against such disqualifications should be made within 14 days from the date of disqualification.

Even so, there is ‘no evidence’ that alleged Goonawardena made an appeal on 4 April 2016 and had continued to remain as the Chairman of the LDB.

The ACF charged that as per the Banking Act there is no provision to grant permission for further submissions. The anti-corruption demanded to know on what basis the CBSL has allowed him ‘time and opportunity’ for further submissions  

Further justifying why Goonawardena’s appeal should not be considered, they empahsised that he has operated two LDB branches in Thambuthegama and Akuressa without the CBSL’s approval, ignoring the regulator’s directive to close down those branches and violating the Act.

Against this backdrop, the stakeholders charged that LDB has continued to pay the salary to Goonawardena from March to August 2016, where he has also enjoyed all the other benefits from the bank, which they alleged is misappropriation of public funds/assets.

Critics demand to know who would take the responsibility for the decisions made by him, the money spent and the allowances and perks enjoyed during the period. (CDS)