We see all kinds of things when it comes to bonds here. The article below caught our eye as we like to keep on top of all the bond scams that are out there (some are very inventive).
Many times, we see these scams and interesting vehicles when it comes to bid bonds and how bid bonds are being used. That’s because once the bid bond is provided, many times the bid bond is not checked after that.
Prime Minister promises new probe over bond scam
Sri Lanka’s Prime Minister Ranil Wickremesinghe said a new parliamentary probe will be initiated into a controversial bonds sale where a firm connected to Central Bank Governor Arjuna Mahendran’s son-in-law benefitted.
“When the next parliament meets, three months will be given for a select committee to probe this and three or four other frauds at the Central Bank,” Wickremesinghe said.
He said if Perpetual Treasuries, the company connected to Mahendran’s son-in-law Arjun Aloysius was faulted, its license could be cancelled.
Wickremesinghe’s United National Party is heading for elections next months with the bond scam casting a cloud over its image of ‘good governance.’ The opposition is also alleging a cover up by the UNP-led government.
The opposition which itself was topped, partly due to allegations of corruption, has happily seized upon the bond scam and apparent inaction of the administration.
The proposed probe is the third so far. The first, conducted by a three-member committee appointed by the PM said further inquiries must be conducted.
The Committee on Public Enterprises (COPE) of the parliament then formed a sub-committee which went into the deal with help from the auditor general. Sri Lanka’s parliament was dissolved before a final report could be tabled.
COPE Chief D. E. W Gunasekera said four out of eight members present on the last day of parliament raised objections.
Sujeewa Senasinghe, a UNP member of COPE, said the three draft documents were given and they were hurriedly summoned by Gunasekera to give a decision. He said from the testimony he felt that the Central Bank Governor was innocent.
Rosy Senanayake and Eran Wickremeratne, also members of the probe committee, said there was not enough time to go through the document/s, which had been delivered to their homes on Thursday night, and more time was needed.
Wickremesinghe said the documents presented for approval to the members was not a COPE report. He charged that Gunasekera and the media, who published news of the bond inquiry, treading on parliamentary privilege.
Wickremesinghe slammed a procedure under the previous regime where bonds were placed among investors while bringing only small amounts to the market.
He said he had personally asked for a fully auction-based sales as under the previous system the Employees Provident Fund was deprived of the market interest rates.
Economists and analysts have been warning for several years that the so-called ‘captive’ sources were forced to bid at lower rates and there was a conflict of interest within the central bank which was expected to get the lowest rate to the Treasury by selling debt and the highest rate to the EPF.