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The Finance Co. To Recover Sussex College Investment

  • TFC is owed Rs 1.8 billion by Sussex Colleges
  • Sunil Jayatissa ‘fas a lot of explaining to do’
  • Sussex Colleges occupying TFC property without payment

By Faraz Shauketaly

The Finance Company (TFC) sources have revealed that the company will be pursuing Sunil Jayatissa and the business known as Sussex Colleges for repayment of a staggering Rs 1.8 billion which still remains unpaid by Sussex. In a revelation that is shocking in the extreme, our sources have revealed that Sussex College was partially funded by deposits taken from the public by a company that did not have a licence from the Central Bank.

Sussex College’s own accountants warned that the company did not have the necessary licences in place from the Central Bank to carry out what ittermed Securitisation Loans.

Sussex College’s modus operandi includes occupying prime property owned by TFC without making any arrangements for the occupation and without provision for rentals. The current management of TFC are working towards correcting this inequitable state of affairs with the interests of their depositors in mind. Sources at TFC have confirmed that the management is focused on ensuring that Sunil Jayatissa and Sussex College pay up or transfer the beneficial ownership of that company to TFC.

Senior Management at TFC state that the transaction to set up Sussex was flawed from the beginning and that Sunil Jayatissa as the Financial Director did so without adhering to proper procedure. The Sunday Leader was unable to verify this viewpoint. However in a matter relating to another school, Leeds, the ownership of that business was vested with TFC after the promoters were unable to maintain the repayment schedule.

The inequitable situation continues: a building in Galle valued at a staggering Rs 63.4 million is occupied without legal title – according to the same report of the Accountants. A senior official at TFC said, “this flippant attitude to the legalities is very strange for a company that has been set up using funds from the public.” Adding to the strange set of affairs, a further sum of Rs 159 million was written off to other Ceylinco related companies. Although Sussex maintains that the agreements with TFC have been terminated, Sussex continues to occupy property belonging to TFC – fuelling a string of legal cases.

In March 2009 the ownership of Ceylinco Sussex Educational Services Limited included: 5,000,095 shares to Ceylinco Tax and Financial Consultants Limited. In turn this company listed amongst its more significant shareholders Sunil Jayatissa with 5,001 shares, Malini Sabaratnam 2,501 shares and that indomitable duo, Lalith and Secille Kotelawala 10,002 shares automatically becoming the majority shareholders of the voting stock in Ceylinco Tax and Financial Consultants. (as of 31/12/2008).

Also in the same period, CT & FC Portfolio Management Limited was listed as having 5,000,000 shares. The shareholders of this company were listed as F&G Property Developers Limited with 90,000 shares and F&G Real Estate Consultants with 7,000 shares. The others included Don Mervyn Jayasinghe with 501 shares, Sunil Jayatissa 501 shares and Lalith Kotelawala, Secille Kotelawala, Sunil Rajapaksha and Malini Sabaratnam each holding 500 shares.

Amongst the non-voting shares a total of twenty Ceylinco group companies made their presence noted with TFC itself owning 10,335,000 shares and the Golden Key Company 23,000 shares.
Quite like most of the so-called Ceylinco Group, this company was no different: all the companies were composed of ownership from within the Group by and large. The domino effect that was waiting to happen did exactly that when the Ceylinco crisis hit the deck in December 2008. The fall of one company led to a fall-out more reminiscent of a pack of cards.

The management of TFC are losing no time: their quest to ensure payment from Sussex College is fuelled by the knowledge that the sum involved is huge: Rs 1.8 billion of depositors’ funds. The fact that Sussex College is making only cursory attempts at discussing payment, the proposals they have come up with is not acceptable to TFC. Sussex is understood to have suggested a payback period of up to 20 years with a nominal interest component. This contrasts with the fact that TFC are paying their depositors on average a rate of 12% over the past five years – making their funding of Sussex College an extremely expensive proposition – something which Sunil Jayatissa appears not to be aware of.

Sunil Jayatissa’s apparent inability to settle amicably with TFC may well jeopardise the operation of Sussex College’s network of schools. According to their own website, they currently operate twenty schools in eight provinces covering fifteen districts. The stated break-even point for Sussex’s operation is to have 7,000 students in 20 schools. They have blamed the lack of numbers on the ‘Ceylinco crisis’ but claim to have reclaimed the numbers lost as a result of the confusion and uncertainty during the period of what may well be termed Kotelawala’s ‘annushorribilis’. Sunil Jayatissa writes and asks “TFC to be patient and pragmatic” but his proposals are anything but pragmatic, says a source closely involved with the TFC operation.

“How pragmatic is it when Jayatissa claims ownership of something that was setup by TFC when he was Financial Controller? So when you work in a company and you leave do you take the ownership of your previous employer with you? This is laughable if it was not so ironic. Now he wants to take 20 years to pay back. Does he want the public to fund Sussex? As it is he is already occupying land that is most certainly within the ownership of TFC. The public’s money is not his grandmothers’ legacy.”

As The Finance Company traverses its difficult path led by a committed team wishing to ensure depositors continue to get paid, the return of assets and or monies to the control of TFC has become paramount. One depositor commended TFC by saying that “TFC have done a national service by continuing to pay the depositors. They must get hold of people who owe TFC money and assets. Why should anyone get anything for free?”
(faraz@thesundayleader.lk)

Sunil Jayatissa, TFC and Sussex College:

1. Sunil Jayatissa was a Director of TFC January 2001 – February 2011
2. Director Finance from 2002 onwards
3. Removed from office in February 2011 by Central Bank Under Section 10(1) of Finance Companies Act 78 of 1988
4. Allegations of failure to discharge duties as a Director revealed in an internal audit
5. Signatory to main bank accounts of TFC

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Golden Key Third Repayments Started

Central Bank appointed management team at the controversial Ceylinco group company Golden Key Credit Card Company (GKCCL) have started sending the third phase payment of a maximum of Rs 100,000 this week.

Payment has been made after consultation with and the approval of the Supreme Court and the Monetary Board of the Central Bank of Sri Lanka. Last payments (Phase 2) made by the Committee of Chartered Accountants was in 2011.  Phase 1 was in 2010.

The Central Bank of Sri Lanka submitted to the Supreme Court a “Plan of Action to provide relief to Security Deposit Holders of The Golden Key Credit Card Company Ltd”  and Supreme Court approved the plan in their Order dated 04.04.2013. Accordingly, a new Director Board was appointed for GKCCL in April 2013 and the Chairman is the former Deputy Governor P D J Fernando. Within a very shorter period Rs. 72.2 million has been distributed among the security deposit holders.

Net balance up to Rs. 731,000  (already posted)
No. of customers   742
Total value of the cheques    26.1 million.

Net balance from Rs. 731,001 to Rs. 1,000,000 (will start to post next Wednesday)
No. of customers   461
Total value of the cheques    46.1 million.

Golden Key Credit Card Company Customer Inquiries – 0115230079 / 0115922613

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No Response

We contacted Sunil Jayatissa for a comment and sent him an SMS when his telephone went unanswered. Here’s what we asked him:

“Mr Snil Jayatissa, We are looking for a comment from you on exactly what your plans are to repay TFC for their funds used to set up Sussex. Kindly call. Thanks, Faraz Shauketaly, The Sunday Leader Newspaper”

We did not receive either a call or a message at the time of going to press.

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