JVP stand on COPE report on Bond scam, Parliamentary debate and AG's final verdict

COPE Chairman MP Sunil Handunnetti

By Janitha Devapriya 

It appears that Sunil Handunnetti, MP and Chairman of the Committee On Public Enterprises of the eighth Parliament, likes to revel in media attention by frequently bringing the COPE report authored by him and other members into the spotlight. 

He, at a media briefing on 26 December as reported in the Daily FT on the 27th, laments that no date has been scheduled for the suggested Parliamentary debate on the report and emphasises that the move to send it to the Attorney General is faulty. He goes further to say that the Government’s inaction maybe an attempt to protect the wrongdoers or those found at fault in this ‘fraudulent’ transaction.

Fraud as is widely perceived is a false representation of a matter of fact, whether by words or by conduct, by false or misleading allegations, or by concealment of what should have been disclosed, that deceives and is intended to deceive another so that the individual will act upon it to his or her legal injury. 

Fraud must be proved by showing that the perpetrator’s actions involved the five elements, namely false statement of a material fact, knowledge on the part of the perpetrator that the representation or statement is untrue, intent on the part of the perpetrator to deceive the alleged victim (in the case of the bond issue, the Central Bank or the Government), justifiable reliance by the alleged victim (the Government in this instance) and injury to the alleged victim as a result. 

Based on the representations and the report of the Auditor General, COPE finds that the Government has incurred a loss of Rs. 889 million on the bond issue of 27 February 2015. (It was pointed out in the COPE report that the calculation of the Auditor General was based apparently on the premise that normal procedure is bidding for bonds by private placements whereas the correct procedure and what is legally acceptable is public auction and therefore the estimation is said to be faulty to that extent). 

If one reads the COPE report carefully, it appears that the determinations show more of procedural lapses or consequences of arbitrary decisions rather than fraudulent transactions. The appropriate authority therefore to conclude whether the said bond issue is a fraud or anything other than a fraud is unquestionably the Attorney General. 

If representations or evidence was submitted to COPE that the bond issue was one of ‘insider trading’, then a valid cause for a criminal offence and action thereto may be established but no such evidence was presented. 

Handunnetti in the same media briefing called for the establishment of a Criminal Justice Commission to probe the matter. This apparently may be a superfluous exercise on this matter since the Parliamentary Committee or COPE itself is such a mechanism. Some Ministers advocate such a step to look into major frauds, embezzlements or questionable transactions including bond issues over the years and to bring the perpetrators to book. 

Therefore, it appears that the Prime Minister under whose purview the Central Bank functions has done the right thing by referring it to the Attorney General. The Attorney General will carefully study the entire COPE report and the annexed voluminous documentary evidence in order to determine whether the COPE findings entail legal action against officials of the Central Bank or the connected parties such as Perpetual Treasuries, the primary dealer who is involved in the ‘controversial’ transaction. 

Sunil Watagoda, associating with Handunnetti at the press briefing, went on to say that the Attorney General is not an investigative arm and the report should have been referred to a body which can inquire into the matter such as the CID or the FCID. Even if the matter is investigated by the CID or FCID, it will be referred finally to the AG for legal steps if warranted. The CID and the FCID in the Police Department functions within the purview of the Ministry of Law and Order. 

The Attorney General on the other hand is the country’s chief legal advisor, State’s primary lawyer in the Supreme Court of Sri Lanka and the highest in rank at the official Bar. Though appointed by the President, the President does not have any power to give orders, mandatory or otherwise, to the AG. Therefore the integrity of the AG’s determination in this connection is unchallengeable. Watagala, if he has any doubts about the Attorney General’s role in this matter, should cast those away immediately.

The JVP’s demand for a Parliamentary debate may appear reasonable but will it serve any purpose? We know that the majority of members in Parliamentary debates babble unnecessarily, often on ill-conceived notions or incomplete information, and many a time use their allotted ‘time slot’ to sling mud at or insinuate members on the other side. Only a few make worthy contributions and they come prepared with facts. 

The Prime Minister has accepted the COPE report on the ‘controversial’ bond issue of 27 February 2015 and acted promptly to refer it to the AG and also agreed for a Parliamentary debate. The report needs careful study by the AG’s Department and no one can fault the Government for the delay, if you think one month and two weeks after it was referred to the AG as too long. 

In the final recommendations in the report, in addition to procedural refinements, it is mentioned that legal action should be taken against former Governor of Central Bank and the Primary Dealer, Perpetual Treasuries. This too can only be determined by the Attorney General after perusing all attendant circumstances, documentary evidence of over 1,000 pages and the relevant facts.

The JVP also criticises the Prime Minister for allegedly usurping the powers of the Speaker as according to them, the report should have been referred to the AG by the Speaker. It is a moot point whether it should be referred by the Speaker or the Prime Minister since the purpose is for the report to be perused by the competent legal authority and determine further legal steps if warranted. There is nothing to restrain the Prime Minister from doing what he did.

So let us all await the determination of the Attorney General. For those who may be disappointed with his decision due to be announced, please do not cast aspersions on him since he is an officer with an impeccable record and legal acumen.