Customs says alleged $ 1 b phantom imports fell outside its remit

Wednesday, 1 July 2026 00:21 - - {{hitsCtrl.values.hits}}

Points to CBSL’s Financial Intelligence Unit and banks as holders of advance payment data
Says advance payments on pro-forma invoices were previously permitted before rules were tightened

Customs Assistant Superintendent Chandana Punchihewa

Sri Lanka Customs yesterday said the alleged nearly $ 1 billion transferred overseas since 2023 through advance-payment transactions without corresponding imports fell outside its operational mandate, indicating that such transactions would instead have been visible to the banking system and the Central Bank’s Financial Intelligence Unit (FIU).

Responding to questions on the alleged “phantom imports” disclosed by President Anura Kumara Dissanayake in Parliament last week, Customs Assistant Superintendent Chandana Punchihewa said the department only becomes involved once goods physically arrive in Sri Lanka.

“Customs was not aware of such transactions. We only get involved once goods arrive within our borders,” he said.

Punchihewa said advance payments for imports could previously be remitted overseas against proforma invoices before goods were shipped, with the relevant commercial banks processing those transactions.

He said the Financial Intelligence Unit of the Central Bank of Sri Lanka and the banks involved would have records of such remittances.

Punchihewa noted that the regulatory gap has since been addressed, with advance payments now restricted to importers registered with Sri Lanka Customs, strengthening oversight of import-related foreign exchange transactions.

Asked whether a similar mechanism could facilitate under-invoicing and illicit capital outflows, Punchihewa said such practices were possible, but added that they would not, by themselves, account for the scale of the alleged outflows disclosed by the President.

Addressing Parliament last week, President Dissanayake alleged that nearly $ 1 billion had been transferred overseas through advance-payment transactions since 2023 without the corresponding importation of goods, describing the transactions as part of a wider network of financial crime.

Separately, MP Ravi Karunanayake has alleged that the suspected outflows were processed through 13 commercial banks and involved 105 shell companies. He has called on the Committee on Public Finance (CoPF) to summon CBSL and banking officials and investigate the matter.