PTL paid EPF informants “Charlie” more than 397 mn for inside information

Commission Chairman Justice K.T. Chitrasiri says only two more witnesses remaining to testify regarding the CBSL treasury bond controversy.

Chief Dealer of Perpetual Treasuries Limited (PTL), Nuwan Salgado, told the Commission of Inquiry (CoI) into the issuance of treasury bonds this week that PTL had paid over Rs.397 million to two informants inside the Employees Provident Fund (EPF) for price sensitive information related to bond auctions. Mr Salgado further admitted that PTL had been paying multimillion rupee bribes to several such informants at different institutions from around the time of its inception.

In evidence led by Deputy Solicitor General (DSG) Milinda Gunathilake, Mr. Salgado, on Thursday (12), testified that the payments had been made from 2014 up to March 2015 to the two informants at EPF for inside information. He further revealed that the informants within the EPF were known by the codename “Charlie.”

The Attorney General’s (AG) Department also produced before the Commission, a document found on Nuwan Salgado’s computer, which detailed a list of payments made to PTL’s informants.

During cross-examination by DSG Gunathilake, Mr Salgado said he had maintained the document on the instructions of PTL Chief Executive Officer (CEO) Kasun Palisena. Mr Salgado told the Commission that PTL’s informants were known by codenames. Accordingly, “Charlie” was the codename used for the informants within EPF. The first informant had been EPF Chief Dealer Udayaseelan and thereafter Chief Dealer Indika Saman Kumara, he revealed. Both were known by the codename “Charlie.” There were several other codenames in the document. The codename “Little John” referred to Kaveen Karunamurthi of DFCC Bank while Naveen Anuradha of National Savings Bank (NSB) was known by the codename “Wolverine.”

There were two other codenames in the document – “Tango” and “Car,” but Mr. Salgado was unable to identify who these informants were.

He said “Charlie” had been paid Rs.97 million in 2014 while for 2015, he had been paid Rs.300 million up to March 15 alone. He said Udayaseelan, who was Chief Dealer in 2014 was paid the Rs.97 million while the Rs.300 million payment went to Indika Saman Kumara up to March, 2015.

Justice Prasanna Jayawardena of the Commission asked Mr Salgado when PTL commenced operations, to which the latter said that it started on September 17, 2014. When queried who the Central Bank’s Governor was when the Rs.97 million was paid to “Charlie” in 2014, Mr Salgado said that it happened during the tenure of Ajith Nivard Cabraal’s term as Governor.

Justice Jayawardena then queried if this meant PTL bribed informants for inside information as soon as it commenced operations, to which Mr Salgado replied in the affirmative.

On Wednesday, Minister of Public Enterprises Development Kabir Hashim and Minister of Development Strategies and International Trade Malik Samarawickrama testified before the Commission saying that they did not advise former Central Bank Governor Arjuna Mahendran to resolve the urgent financial need of Rs 15 billion for the government through controversial bonds issued later by the bank.

Both ministers pointed out that the day before the bonds were issued, a meeting was held with then Governor Mahendran regarding urgent need to release Rs 18 billion for road development work and they were told only Rs 3 billion was available at that time.

When Commissioners questioned whether the United National Party (UNP) was given funds by Perpertual Treasries Limited (PTL) or its Director Arjun Aloysius in the past, Minister Samarawickrama replied no such transactions took place between PTL and the party.

Both ministers also told the Commission that the meeting which is said to have taken place a day before the bonds were issued was an unofficial one.

The ministers testified briefly and the Attorney General (AG) team stayed away from cross examining them as the Commission had summoned them.

Meanwhile, the CoI this week, also ordered PTL to hand over two files the company allegedly maintained on former Finance Minister Ravi Karunanayake and former Central Bank Governor Arjuna Mahendran detailing “to do lists” for them.

The Commission issued notice to former PTL Director Arjun Aloysius and his father Jeffery Joseph Aloysius to immediately hand over the two files, labeled “RK” and “AM,” as the Commission needed to investigate them.

The Commission further ordered Steve Samuel, Personal Assistant to Arjun Aloysius, to submit a sworn affidavit on information regarding these two files.

Acting Solicitor General Dappula De Livera had on an earlier occasion, informed the CoI that text messages between Arjun Aloysius and his personal assistant Steve Samuel revealed the existence of two files named RK and AM that PTL had maintained.

The files were headed “Things to do for you” and further investigations revealed that “RK” referred to Ravi Karunanayake and “AM” referred to Arjuna Mahendran, the AG’s Department stated.

However, Attorney-at-Law Jeewantha Jayathilake, who appeared for Steve Samuel, informed the Commission on Wednesday that his client was currently receiving treatment at a private hospital in Colombo after suffering cardiac problems and that he was hopeful of submitting a medical report in this regard.

The attorney further informed the CoI that his client did not possess the two files labeled RK and AM allegedly maintained by PTL.

Minister of Development Strategies and International Trade Malik Samarawickrama and Minister of Public Enterprise Development Kabir Hashim were also summoned this week by the Commission to testify.

Commission Chairman Justice K.T. Chitrasiri informed that they only needed to question two further witnesses – Central Bank Monetary Board Member Nihal Fonseka and Steve Samuel, Personal Assistant to Arjun Aloysius. Justice Chitrasiri said the AG had submitted a list of 20 witnesses to testify before the Commission and only the aforementioned persons remained from that list to give evidence.

He noted that the two Ministers were summoned by the Commission itself and were not on the list of names submitted by the AG.

The Commission is probing the issue of CBSL treasury bonds from February 1, 2015 to March 31, 2016 and comprises Supreme Court Justices K.T. Chitrasiri (Chairman), Prasanna Jayawardena and retired Deputy Auditor General V. Kandasamy.