Industrial Finance Tottering On The Brink?
R. Wijewardene
Over the past weeks The Sunday Leader has reported on the state of the struggling Industrial Finance Company.
Having received letters of complaint from depositors who have not received interest or been able to withdraw their capital for several weeks The Sunday Leader began an investigation into the once respected finance company based at Maitland Crescent.
Just two weeks ago on November 12, IFL Chairman Upul Soyza pledged that IFL would pay its depositors in full within two weeks. However a week later depositors had not received even part payment of the money due to them.
The following week on Friday, November 20 The Sunday Leader was again contacted by the management of the IFL who assured the newspaper that new UK based investors had been found and that payments would be made to depositors within a few days.
However this week we received complaints from depositors claiming that they had still not received any of the money due to them.
A number of desperate depositors further claimed that it has now become virtually impossible to contact the IFL by telephone and that it is now necessary to visit branches in person to have any contact with company.
However it was later reported that of the IFLs three branches only the head office in Maitland Crescent remained even partially operational.
“I have not received interest for several months, and we have been unable to withdraw mature deposits for over six months,” claimed M.R. Sampath, a long term depositor with IFL.
“ We have complained to the Central Bank but they have taken no action — maybe the IFL isn’t large enough for them to care — but we have families and need the interest to support ourselves.”
“The situation is absurd unless we stand outside the office and beg we are given nothing. I got my last tranche of interest paid only after standing outside the office for hours — they no longer pick up the phone and I have still only received a part payment,” explained Nelson, another long term depositor.
The situation at the IFL with branch closures and the failure of staff to respond to calls and complaints again indicates that the finance company is in a state of virtual collapse. With over 1000 depositors and billions of rupees worth of worth of deposits, IFL’s failure is not a minor affair. The effect of this latest corporate collapse will trickle across Sri Lanka’s largely unregulated finance sector.
But of course the effect will be most keen felt by the IFL depositors many of whom have life savings and pensions locked away in deposits, at what they thought was one of the country’s most respected finance companies.
“We thought IFL wasn’t like Ceylinco, that it was respectable and registered with the Central Bank, but we were let down by IFL and also by the Central Bank,” claimed Weligepola whose pension is currently locked in an inaccessible IFL fixed deposit.
Several depositors stressed that despite months of delayed payments and the fact that they were unable to withdraw even mature deposits the Central Bank has refused to take action.
“When we speak to the Central Bank they tell us that the IFL has pledged to find the money and that new investors have been found. But we no longer have any faith in the Central Bank as they are on their side not ours ….” Weligepola continued.
Disgruntled by the failure of the Central Bank to take action a group of depositors is reported to have registered a complaint with the Borella police. The depositors made a complaint to the effect that their money had effectively been stolen by the IFL and as a response to the police complaint the depositors in question are reported to have received some settlement from the IFL.
Again while the drastic action taken by these determined depositors allowed them to recoup their investment, for hundreds of other depositors the situation remains dire. As the IFL looks less and less like a functional company and more like a failure it remains incumbent on the Central Bank even at this late stage to take action and protect depositors from a tragic re run of the Golden Key saga.
I wonder why the Sunday Leader highlight the non-payment of depositor’s money of Industrial Finance Company with such enthusiasm, when a colossal sum of 26 Billion spirited away by the Ceylinco Group’s Golden Key Credit Card Co Ltd. The Ceylinco Directors are living a life of luxury after playing out the money of the public of Sri Lanka. The Central Bank and the Ministry of Finance are sleeping on this matter. Is the Sunday Leader who professes to be unbiased Journalists censoring the misdeeds of their advertisers and highlighting the wrong doings of others? All you did was to run a list and paint all the depositors at Golden Key as people who had deposited black money. I do not think people who have black money in Colombo will keep it in Sri Lanka.
What is happening to Okanda Finance and Vajira House builders. They also, took billions from depositers and still noreponse from them as well.
Sunday Leader please inveestigate them thoroughly as well.
Disgruntles depositer..
According to my knowledge IFL was started facing all this problems after they merge with CIFL Finance and Asset Management Ltd. (not regestered with Central Bank)It was an illegal transaction which was done with out informing to the Central Bank of Sri Lanka. In this transaction they transferred around 2 billion deposit base to the IFL and there is no assets to match them. It is very clear that there must be a bid frode has taken place when they do this illegal transaction.
Sunday leader can start Investigations on that.
hunter
Even after the supreme court has made a clear order to pay back depositors of golden key the central bank officials are sleeping!!!! we are finding it very difficult to survive on a day to day basis…….May GOd bless Mr Kotalawela and Ceylinco consolidated
Are you gaga or what? These people (ceylinco, ifl, etc) are not going to be investigated by anybody. They have paid the Big Boys enough money to see to that.
Lets change the big boys brother.
I am another depositor at CIFL and later transferred to IFL, we cant get our money back. Sunday leader please instruct us what is the proceedure that we should follow in this regard. Upul soysa is enjoing his life with our hard earned money. He can sell his properties and pay our money. We are cluless about as how we can get our money back???
I spoke to the lawyer regarding this since my money is in CIFL as well. The lawyer is the one handling the sri ram case.
If you take legal action yourself towards this company, the Court will order the company to cease operations and shut the whole CIFL company until they pay the money. The central Bank too would be in great trouble for not supervising and monitoring CIFL properly whereas the court will order the central bank to take responsibility and pay the depositors back their money from the central bank. CIFL knew that they cannot mess with me and they gave back my money. I advise you to take legal actin in supreme court as soon as possible to get your money back.
I am another victim of IF , All my savings are stuck with them and they keep moving their story everytime ask for interest and money – Sunday leader – what legal action can we take against them ? Do you think Central Bank will protect our money ? I was promised so many times that money will be settled by IF but nothing was done