Govt. to consider tightening laws on white collar crimes

• Keheliya says Finance Ministry could probe SEC Chief’s claims; Harsha wants action

By Uditha Jayasinghe

In the wake of Securities and Exchange Commission Chairman Tilak Karunaratne resigning, the Government yesterday said that it would consider the possibility of introducing legislation to curb white collar crimes.

Responding to questions at the weekly Cabinet briefing, Media Minister Keheliya Rambukwella said that the reasons for the SEC Chairman Karunaratne’s resignation would also be investigated by the Finance Ministry.

“In the legal framework, there is room for anybody to take it (stock market issues) up. There is a debate on this because newspapers have quoted stock market investors saying there aren’t issues, but there is space for parties that feel disadvantaged to take action,” he said.

Following repeated questions on what action the Government would take over Karunaratne’s comments of being pressurised into resigning, the Minister emphasised that the Finance Ministry could conduct investigations. 

“Complaints will be investigated and it will be looked into by the Finance Ministry. These allegations will be investigated and a report will come out. If there aren’t adequate laws then there should be new laws to detect white collar crime. So we will need to bring in amendments to address these issues. This is not a healthy trend for two people to resign.”

He noted that if there were specific complaints they would be investigated, but refrained from commenting on the latest resignation, insisting that he did not know the contents of the two-page resignation letter sent by Karunaratne to the Finance Ministry.     

In response to Minister Rambukwella’s remarks yesterday, UNP MP Dr. Harsha de Silva in a short statement said the Opposition had been highlighting the large-scale white collar crime taking place in the financial markets since mid-2010.  

Particular reference was made repeatedly to a series of questionable investments of the EPF in certain non-blue-chip stocks at the CSE and also in banks and financial institutions, contravening its own investment guidelines.  

“Instead of dealing with the issue and nipping it in the bud, a particular politician pretending to be an independent regulator instigated a despicable attack on us, the messengers, in a desperate attempt to divert the public attention as the frequency of white collar crimes began to increase.  It is now obvious that it did not work,” the UNP MP said.

“When I first questioned the transaction between the NSB and The Finance Company within the time limit to cancel the deal, the Government, advised by white collar criminals themselves, dismissed the allegations as political talk. However we all know how the President intervened to cancel that transaction outside the normal regulations after the chorus grew with NSB staff walking out with the resignation of one Director who spilled the beans,” Dr. de Silva said.  

He also emphasised there was a need to enhance the powers of the SEC to swiftly act on white collar criminals and the UNP would certainly support amendments to the existing legislation to do so.

“However, there is ample room within the existing law to prosecute white collar criminals with jail terms up to five years upon conviction at a Magistrate’s Court.  We await action even at this late stage against these criminals as well as those who protect them,” Dr. de Silva said.