Three mega deals:

Govt lost US $ 515m

by Ranil Wijayapala

The Anti Corruption Committee Secretariat (ACCS) conducting preliminary investigations on the complaints it received on mega financial frauds that had taken place during the previous regime found that the government had lost US $ 515 million on three mega deals alone, an official of the Secretariat told the Sunday Observer.

He said the financial loss had been on the construction of the Kerawalapitiya thermal power plant, purchasing MIG 27 aircraft for the Sri Lanka Air Force and the Hedging agreement of the Ceylon Petroleum Corporation.

“These are not new cases and all these suspicious deals have been revealed and extensively discussed in the media but no investigation had been done. The three cases have been already handed over to the Fraud and Corruption Investigation Division (FCID), the newly established Police Division to investigate mega financial frauds”, the official added. The Anti Corruption Committee had received a large number of complaints relating to massive financial frauds and after preliminary studies of the cases the files are being handed over to the (FCID) of the police for investigation.

He said investigations have already been launched in several cases but declined to reveal details of the investigations.

“There are several complaints on frauds that had taken place in the Ministry of Economic Development. One such complaint to be investigated is on corruption that had taken place when the Divineguma Department was set up amalgamating the Samurdhi Authority, Southern Development Authority and the Udarata Development Authority”, he said.

The complaint alleged that a massive fraud had taken place in paying compensation and gratuity to the employees whose services were terminated or voluntarily retired when these institutions were merged in the Divineguma Department.

“The value of the alleged fraud is Rs. 596 million”, the official added.

The official said the ACCS has called for public support, especially from officials in these government organisations to get further information regarding these large-scale financial crimes.

Police Spokesman ASP Ruwan Gunasekara said the FCID which is conducting investigations on the mega financial frauds had recorded a statement from the former CPC Chairman Asantha de Mel on the Hedging agreement where the government had allegedly lost US$ 200 million. He said the fraud on the construction of the Kerawalapitiya thermal power plant is estimated around US $ 122 million because the authorities had spent US $ 332 million on the project whereas it could have been done at a cost of US $ 210 million, according to preliminary investigations.