By Frederica Jansz

Jayanthi Chandani Gunewardena, sister of Mangala Samaraweera and wife of Nimal Gunewardena (Managing Director, Bates Strategic Alliance) on November 12, 1997 was granted a Temporary over Draft (ToD) of Rs. 2.5 million at a 21 percent interest rate per annum by the Peoples Bank, Town Branch, Nugegoda.

Exactly one month later, on December 12, 1997, the same bank granted an additional Rs. 500,000 to Standard Media (Private) Limited at a twenty eight percent interest rate per annum. The overdraft was allowed on account no. 154-000597-4.

Jayanthi Gunewardena nee Samaraweera, in 1997 was a 'Director' at Standard Media (Private) Limited. Upon negotiating the said ToD, Gunewardena was a signatory together with three others guaranteeing that the overdraft of Rs. 3 million would be settled within a period of 90 days. The other three guarantors are A. Weerasinghe, Jagath Deerasekera and Victor Joseph Imbaraj, all close associates of Mangala Samaraweera.

Later, this overdraft was re-negotiated when the company was unable to pay back any of the interest and capital due and an extension granted to a period of one year whereby Standard Media (Private) Limited was given time until September 1, 1998 to honour their debt.

It is now well nigh upon four years since the overdraft was first negotiated and the outstanding balance as of last week stands at Rs. 3, 618, 898.85 on account no. 154-000597-4.

The reason for taking the overdraft in 1997 was to publish a Sinhala newspaper named Irida, to back the People's Alliance government. The Peoples Bank, Town Branch at Nugegoda were coerced into granting the temporary overdraft after it had been impressed upon the chairman of the Peoples Bank that Jayanthi Chandani Gunewardena is the sister of Mangala Samaraweera who in 1997 was the powerful minister of posts and telecommunications.

Such was the influence carried that the General Manager of the Peoples Bank, Town Branch, Nugegoda on November 17, 1997 accepted a hand written promissory note from Standard Media (Private) Limited which pledged to honour the original overdraft of Rs. 2.5 million granted five days earlier on November 12, 1997. There was no other collateral. And the Bank has not acted on the promissory note either.

This same 'understanding' stood even after an additional Rs. 500,000 was granted one month later bringing the total amount to Rs. 3 million. The only security given was this 'influential understanding' and 'promise' to honour the overdraft.

Upon being granted Rs. 2.5 million, Jayanthi Gunewardena had requested an additional Rs. 1.5 million. This amount was however refused and a further Rs. 500,000 given instead.

The reality of this story, like all other issues of corruption, is that the loan was never honoured. The newspaper Irida hardly sold which resulted in Standard Media (Private) Limited having to close shop. The capital of Rs. 3 million remains outstanding -- proof of one more instance where the funds of a state bank have been misused by political miscreants.

The Peoples Bank was initially told that the Irida newspaper would sell a minimum of 20,000 copies per week. As such, Jayanthi, together with her other guarantors, told the bank that the temporary overdraft could be settled in full within a period of four months from the date it was granted.

Whether Standard Media (Private) Limited ever sold 20,000 copies of Irida is something we will perhaps never know. What we do know however is that the company and its four guarantors did not settle its dues to the Peoples Bank, Town Branch, Nugegoda.

A senior manager at the Peoples Bank confirmed to The Sunday Leader that Rs. 3, 618, 898.85 remains outstanding at present on account no. 154-000597-4 since the overdraft was granted in November and December 1997, respectively.

When The Sunday Leader attempted to contact Jayanthi Gunewardena at the address given to the Peoples Bank which is one and the same as that listed in the telephone directory as Standard Media (Private) Limited, 125/3, 3rd Lane, Subhadrarama Road, Nugegoda, the five telephone numbers were no longer in use. Jayanthi's husband Nimal Gunewardena when contacted at Bates Strategic Alliance said any faxes to his wife could be sent to his office fax number at Bates. Asked if Jayanthi did not possess a contact telephone number at Standard Media (Private) Limited, Nimal Gunewardena hedged, repeating that any official contact with Jayanthi should be made via his official telephone and fax numbers.

It remains to be seen if in similar vein to the Janatha Vimukthi Peramuna's Wimal Weeravansha, The Sunday Leader will this time around too be accused of conniving with opposition politicians and fabricating the names which took responsibility for this loan and the documents.

Weeravansha and the JVP behaved in a manner typical when caught with your pants down. Since The Sunday Leader rose to the JVP's challenge to prove our story -- we in fact did so a second time around last Sunday, -- Weeravansha has remained strangely silent.

Why cannot Weeravansha and his band of brigands chastise the likes of Jayanthi Gunewardena nee Samaraweera and Ronnie Peiris who have used political influence to force state banks into granting them sums of money which they in all probability have never had any intention of honouring.

Ironically, the principal allegation levelled both by the government and the JVP against the opposition for defeating the probationary government is that it was done at the behest of bank defaulters who wanted to protect their ill-gotten wealth.

It now seems, ironically, that from Ronnie Peiris to Jayanthi Gunewardena, the beneficiaries of defaulting on bank loans have been none other than those nearest and dearest to the president and her chief lieutenant Mangala Samaraweera. No wonder then that the JVP is silent on these issues.

These sums of monies handed out by state banks with such aplomb leaves members of the general public stupefied. We are all too aware of the vigorous 'hassle' one has to contend with when approaching a bank for even a Rs. 10,000 overdraft. Being given Rs. 3 million as an OD would be literally like plucking money from trees for many. Not so for politicos, their relatives and henchmen. This is the bane of Sri Lankan politics that we breed politicians who blatantly lie to their electors and rob state banks in order to ensure a sullied and yes, even nefarious political career.

Brothers, sisters, uncles, aunts and nephews are all part of the merry bandwagon. Holding political office in Sri Lanka certainly helps spring eternal hope in the hearts of these blackguards.

The Sunday Leader recently highlighted other instances where the Bank of Ceylon has apparently connived with rogue businessmen and politicians, granting stupendous amounts of money with little or no collateral. Loans, that now cannot be recovered and are relegated to being bad debts.

The Eelam Peoples Democratic Party (EPDP) led by Douglas Devananda has been granted a loan facility by the Bank of Ceylon, Thimbirigasaya branch for Rs. 5 million and Rs. 30 million by the Peoples Bank. Both these amounts remain outstanding and to date have not been recovered. Recently, this year, the Bank of Ceylon granted USD 15 million to Sri Lankan Airlines on a 'clean basis' which means no security was taken. The loan was granted on the specific instructions of the government.

Another case in point is the granting of two huge loans to a single individual who has bought himself a seat on the board of the Pan Asia Bank. A rupee loan of 68 million and a US dollar loan of 1.2 million, was given by the Bank of Ceylon to a local businessman, Sidney Jayasinghe.

The only security against the rupee loan for sixty eight million was 3,056,153 shares of Metal Recyclers (Colombo) Ltd. of which company Jayasinghe is chairman and the indemnity of directors of the company who are all family relations of Jayasinghe.

Another loan for Rs. 50 million was granted by the Bank of Ceylon to the Ven. Pelpola Vipassi Thero on June 26, 1997. The Ven. Pelpola Vipassi Thero apparently promised the bank that both the capital and interest on the loan would be settled out of funds received from donations from Japan.

Up to the end of August this year, Ven. Pelpola Vipassi Thero owes the Bank of Ceylon, Borella branch, Rs. 38 million against accumulated interest only. The capital of Rs. 50 million also remains outstanding.

In a separate case, a young girl by the name of Kumarasinghe Margaret Perera was given a loan of Rs. 6 million by the Bank of Ceylon, Kurunegala branch. She has given her permanent address to the bank as no. 36, Udumulla Road, Battaramulla. Two other young ladies were accepted as guarantors. Their names are Seetha Nanda Gunapala and Madara Gunapala. An address for the two guarantors was given at Pathiraja Estate, Elpitiya. According to officers at the Bank of Ceylon, all three women have since disappeared off the face of the earth. This is just one more loan than the Bank of Ceylon is forced to write off as a bad debt.

Doubtless, Mangala Samaraweera's sister, Jayanthi, is also only too aware of how easy it is to declare bankruptcy and thereafter simply 'forget' one's financial commitments. After all, these are state funds which if not recovered, are easily written off -- while the banks hound members of the public who do not enjoy political patronage to honour their commitments which in most instances are meagre in comparison to financial dealings such as this one.

By Rahul Amarasinghe

As the nation watches with not a little amusement, the antics of our embattled politicos, the most entertaining sideshow of all must surely be that between PA strongman Anuruddha Ratwatte and his erstwhile strongman colleague S. B. Dissanayake.

These are the two powerful ministerial names that not long ago drove grown men to the depths of utter despair, for it is an open secret that it was their collective might that won the PA its electoral victory one year ago.

The status quo however, has now changed drastically with political desertions and pole-vaults and the two tough guys find themselves pitted against one another in a do-or-die battle for victory for the parties they represent. With S. B. gone, the PA must now look to the electoral antics of Ratwatte to deliver the goods for them, come December 5.

Not long ago, the toothy twosome may well have slapped each other on the backs in a show of mutual solidarity for the other's questionable actions on election strategy. Today, they will happily bury the hatchet on each other's necks. Beatific smiles plastered on their cherubic faces, the one-time bosom pals are now vitriol spewing enemies, each no doubt immersed in some elaborate scheme of how to get the better of the other come the December election.

To make things more interesting, or should that be 'more deadly,' Anuruddha Ratwatte's infamous son Lohan will also be playing no mean a role at the forthcoming election. One need not be an aspiring Nostradamus to predict a volatile election in the central province, if not downright violence and bloodshed in the run-up to the December 5 election with the Ratwatte-Dissanayake factions in open confrontation.

In the immediate aftermath of the crossover, the government, predictably, sank to abysmal depths in tearing the dissidents apart. Even Professor G. L. Peiris, the respected academic, was not spared. What disgusted the ordinary man was the fact that it was only after these men changed their affiliations did the government suddenly discover the list of alleged misdeeds. Until this, whenever The Sunday Leader exposed corruption in government or abuse of power for that matter, the stock response was that it was the work of the media mafia acting on the dictates of corrupt businessmen. But lo and behold, no sooner a PA member crosses over, the government suddenly discovers skeletons in the cupboard and corruption of staggering proportions on the part of the defectors.

The nation was thus suddenly made privy to all the alleged dirty secrets of the eight dissidents, S. B. Dissanayake in particular. His alleged Samurdhi misappropriations were hot news on state channels as were the aerial images of his house in Hanguranketha that were splashed on state TV, noon and night. The question was posed as to how a man who was of modest means when he entered politics had amassed such wealth as to build such sprawling mansions. S. B. they blared, had been caught with his chubby hand in the Samurdhi kitty.

Dissanayake in turn went on television defending himself, explaining how he raised the money to build the house and making counter-charges against his former colleagues including the president, Mangala Samaraweera and Anuruddha Ratwatte. Why were they singling out his house, he asked heatedly; what about Ratwatte's mighty edifice in the heart of his Kandy stronghold? That 'maligawa' at Anniewatte in Kandy under construction by Ratwatte is estimated at a cool Rs. 60 million.

And as S. B. Dissanayake wrote in a letter addressed to both President Chandrika Kumaratunga and Minister Mangala Samaraweera, "Today my house has become a palace to the two of you. I don't have a problem with this. It is a well designed, beautiful house in a scenic location. There aren't 35 rooms. There are only four bedrooms. The second floor is just one room. The total cost of the house was Rs. 8.9 million. The total cost, including the party office nearby, is Rs. 15 million. I have given details of all these expenses to the relevant departments and institutes."

For his part, Anuruddha Ratwatte is yet to respond to the raised eyebrows with regard to his house.

And so the battle of the houses rages on with not just S. B and Anuruddha but their sympathisers and supporters too clambering on the bandwagon and proffering their two cents on the million rupee mansions. Others meanwhile wait in eager anticipation for S. B. Dissanayake to reveal more details on who built houses on the banks of the Nile, France and London as alleged by him.

That being the case, The Sunday Leader sent its sleuths to capture on camera the much talked of 'Ratwatte Maligawa.' And yes, it is a sight to behold though we did not have the luxury of a helicopter sponsored by the state to get an expansive aerial view.

What you see on the left is a shot of the 'Ratwatte Maligawa.' The president who recently accused Ratwatte of being the most corrupt among her ministers will do well to give the people the benefit of Ratwatte's Maligawa too by despatching a helicopter -- and a cameraman to get an aerial view. But don't hold your breath folks!

Covering a 7000 square ft area, Director General, UDA, W. A. Siriwardena, said, "These are legitimate expenses." He explained that the floor had been given a facelift after a period of 17 years and was "very badly in need of a new look," no doubt to suit the former dress designer-turned poilitico's taste.

Besides Mangala Samaraweera, the offices of the Minister of Social Services, Plan Implementation and Buddha Sasana are also located on this floor, Siriwardena claimed.

At a time when the country has recorded a zero national growth and the government continues to insist there is no money in state coffers to purchase emergency power that will help eradicate or reduce existing power cuts -- Samaraweera saw it fit to carpet, curtain and "dress up" his offices with artworks and sculptures.

All this while Samaraweera reduced to rubble makeshift and cement structures of poor and middle class business people who have been left destitute after their trading places were destoyed by the UDA.

Samaraweera saw it fit to spend over rupees two lakhs for artworks to adorn the second floor at Sethisiripaya and Rs. 225,000.00 for sculptures to grace the 'minister's area.'

Despite the government insisting that this country is facing staggering financial burdens, so much so that President Chandrika Kumaratunga recently appealed to the nation to observe a period of austerity, her energetic and youthful minister at the UDA went ahead and spent a colossal Rs. 25,406,171.86 to give the ministerial floor at Sethsiripaya an expensive and plush interior.

Samaraweera has gone so far as to even purchase 'glass wash basins' at a cost of Rs. 82,237.50 and chairs that have cost over Rs. 6 million.

Carpets from" Delmage cost over Rs. 6 lakhs while over rupees two lakhs was paid for venetian blinds.

M/s Athula Wijayarathne Associates (Pvt) Ltd is to be paid Rs. 1,068,581.35 for completing demolition and civil works. A. T. Cooray & Sons Manufacturing Ltd. will pick up a payment of Rs. 3,589,216.66 for providing partitions while an additional amount of Rs. 2,553,646.62 will be paid by the UDA for furniture bought from A.T. Coorays.

Synex International (Pvt) Ltd will be paid Rs. 708,287.83 for installing data and telephone cabling and another Rs 2, 601,480.39 for providing lighting and power.

Delmage Interior DŽcor (Pvt) Ltd will be paid Rs. 678, 197.12 for carpets that have been purchased while Access International (Pvt) Ltd will collect a cool Rs. 1,794,549.44 for completing ceiling work.

Srini Nirmalalingam will collect Rs. 291,500.00 for artworks and Fentons Limited Rs. 696, 375.00 for installing PABX system with instruments.

Trine (Pvt) Ltd will collect Rs. 6,551,903.42 for chairs that have been purchased and an additional Rs. 82,237.50 for glass wash basins.

Siem Constructions (Pvt) Ltd will be paid Rs. 2,423,389.50 for tiling and Sing Fab (Pvt) Ltd Rs. 31,113.78 for installing signboards.

Louvre Blind Products has billed the UDA for Rs. 218, 878.67 for venetian blinds and Diyabubulu (Pvt) Ltd will collect Rs. 225, 000.00 for providing sculptures to grace the ministerial floor.

Nelu De Zoysa design Corporation (Pvt) Ltd will collect Rs. 1,891,794.68 as consultancy fees

It is ironic that at a time when Samaraweera himself has accused ex PA heavyweights of constructing 'maligawas' costing millions, the UDA minister spent over rupees twenty five million to refurbish his office premises at Sethsiripaya. (FJ)

By Frederica Jansz

An investigation by The Sunday Leader has found that Kamal Ratwatte - son of Clifford Ratwatte and first cousin to President Chandrika Bandaranaike Kumaratunga - has spent a colossal Rs. 7,671,312.00/- during his tenure as Executive Director of the National Insurance Corporation Limited to furnish the executive offices of the corporation situated at 120.124 D. S. Senanayake Mawatha, Colombo 8.

Importing furniture from Pacific D‚cor Pte. Ltd, Ratwatte used funds last year allocated to the National Insurance Corporation to purchase a chair for himself that cost over rupees two lakhs (USD 2,586/-). In his capacity as Executive Director at the time, (Ratwatte still remains on the Board of the National Insurance Corporation) he also bought a visitors chair for his room at the corporation which cost USD 4,974/-, a cabinette (low for USD 3, 492/), a cabinette (high for USD 1,082/), an executive director table for the princely sum of USD 4,809/-, (over Rs. 4 lakhs), an executive director visitors seating for USD 4, 608/- and a coffee table for USD 1,008/-.

The chairman's room was also refurbished. A chair for Ashley Herat cost the same as Ratwatte's at USD 2,586/-, while a visitors chair, cabinette-high, cabinette -low, chairman's table, visitor's seating and a coffee table were all purchased at the same price as Ratwatte had paid for furniture to adorn his office suit.

Deciding to go the whole gamut, new furniture for the conference room was also purchased. Another chair for the chairman in this room was bought for USD 1,885/- and an additional USD 13, 050/- spent for other chairs in the conference room while USD 2,984/- was spent on a conference room table. USD 12,311/- was used to buy customers chairs for the reception area while a chair for the receptionist was purchased for USD 558/-.

Chairs for the auditorium were bought for USD 18,720/- while a table was purchased for USD 1,930/-. A sofa for USD 2,608/- was purchased for the waiting room and a coffee table for the same room bought for USD 1,008/-. A chair for the general manager's room cost USD 1,652/- while a table and low cabinette cost USD 1,934/- and USD 1,746/- respectively.

The entire purchase for the furniture alone cost the National Insurance Corporation a stupendous amount of over rupees seven million.

All this after Ratwatte had negotiated and paid ninety five million rupees to purchase this building which originally housed the HPT Holdings Pvt. Ltd. The main offices of the National Insurance Corporation are still located at this building at D. S. Senanayake Mawatha, Borella.

The local 'agent' who sold this furniture at such exorbitant prices to Kamal Ratwatte is one Ravi Jayawardena - Director of Golden Palm Project (Pvt) Ltd. The payments for this furniture though bought from Pacific D‚cor Pte. Ltd was made to Golden Palm. Jayawardena in fact had craftily submitted three bids when the tender was called making sure that all his three bids fitted the required specifications.

Though how Kamal Ratwatte can justify the need to buy a chair for himself and the Chairman that cost over rupees two lakhs each and a work table that cost over rupees four lakhs is mind boggling. How such specifications were even tabulated is amazing.

Squandering public funds appears to be a past time of the Ratwattes if we are to go by the track record of another relation, Anuruddha Ratwatte.

Last year, Kamal Ratwatte was not averse to allowing the Insurance Corporation pay a sum of USD 8,861.13 (Rs. 658,470.57 valued at Rs. 74.31 to the dollar last year) against expenses he had incurred on an overseas visit using his American Express Corporate credit card. The amount was paid by the Insurance Corporation on April 27, last year, issuing cheque no. 097529 against the card member's name - Kamal Ratwatte - for card no. 3769 716438 81004.

Later, Ratwatte allowed for this amount to be deducted from his monthly reimbursements by the Insurance Corporation when he got wind that the said invoice had leaked out of the corporation.

He however allowed the corporation to pay another expense on this same credit card for the sum of USD 5,840.30/- (Rs. 417,581.45). This amount was paid by the corporation to American Express Corporate card account remittances by cheque no. 032273 on July 7, 1999. Kamal Ratwatte did not bother to meet this payment himself for personal expenses he had incurred on his credit card.

Kamal has blatantly violated the criteria that public officials when undertaking foreign trips and representing the state are allowed certain specified sums of money which by no stretch of imagination runs into thousands of dollars and lakhs of rupees.

Using public monies to pay credit card bills outside the specified rates for officials on overseas visits stipulated in government regulations will now open Kamal Ratwatte for an investigation by the Bribery Commission.

Perhaps Kamal's penchant for good living at the expense of public funds and disregard for any consequences maybe his claim to being one of the president's favourite cousins. His mother has often looked after Chandrika's children at Temple Trees while his father Clifford Ratwatte is a close and favoured uncle of Kumaratunga's.

Kamal Ratwatte could not be contacted for comment. Ratwatte is also founder chairman of a tea firm - Kas & Kami International (Pvt) Ltd.

The battle against corruption took another turn last week with the opposition lodging a complaint with the permanent commission investigating allegations of Bribery and Corruption on the business dealings of President Chandrika Kumaratunga's close friend and confidante, Ronnie Peiris.

The complaint lodged by UNP Assistant Leader Gamini Athukorale not only calls for a probe on Peiris but also whether there was patronage extended to him by the president, Minister Mangala Samaraweera, Chairman Bank of Ceylon Ken Balendran and any other officials.

Peiris, a British citizen was a frequent visitor to Sri Lanka following Kumaratunga's ascendancy to the presidency in 1994 and formed a company named Blue Class International Inc in the tax haven Bahamas to do deals in Sri Lanka.

Furthermore, no sooner Kumaratunga assumed the fiinance minister portfolio in 1994, Peiris who was a struggling businessman in London running a travel agency also shifted his bank account from the state Bank of India to the Bank of Ceylon branch in London and obtained a loan of over 500,000 pound (approx Rs. 65 million). This loan he defaulted and the Bank of Ceylon after several years waived off over Rs. 15 million interest due without moving on the collateral. Questions have also been raised whether there in fact was any collateral taken on the loan.

The probe has been called for in the backdrop of other business dealings where Peiris had allegedly made huge commissions by obtaining cabinet approval for projects he promoted such as the controversial golf course in Kotte. In addition to the golf course project which was later expanded to provide for housing as well on a cabinet paper submitted by Minister Mangala Samaraweera, Peiris also promoted the ABC radio network for which he obtained BOI approval and the necessary licences. The shareholding of Peiris in ABC is held in the name of the Bahamas based Blueclass Inc, which account is in the Channel Islands.

Evidence has also surfaced that Peiris was involved in the Katunayake-Colombo expressway project and that Keangnam had deposited monies to the Blueclass Account from its People's bank account in Colombo.

President Kumaratunga, when the allegations of Peiris' involvement in the project first came to light at a specially convened meeting of PA parliamentarians vehemently denied the charge and accused the minister in charge of the subject at the time A.H.M. Fowzie of mishandling the issue.

Following the revelations of the business dealings of Peiris, he left the country via Delhi the previous week and his son Ravin followed suit last week.

Meanwhile, a British legal firm has already being instructed to make representations to the Bank of England and the British Tax authorities on the business activities of Peiris to ascertain whether he has made full disclosure, in addition to tracing any disbursements made out of the Blue Class account to any other persons.

The UNP Assistant Leader, Gamini Athukorale in his complaint to the Bribery Commissions which was presented in person on Thursday calls for an investigation into the matters stated in his complaint "without delay given the continuing plunder of national resources by this intimate crony of the president, to the national detriment," (see box for full complaint).

The chairman of the commission, former Supreme Court judge, Ananda Coomraswamy, assured Athukorlalae, a full investigation will be made on his complaints.

Meanwhile the commission, is also to be questioned on what action it has hitherto taken on the complaint against Minister Mangala Samaraweera relating to the credit card issue.

A letter will go out this week from the complaint, Dr. Rajitha Senaratne in the light of the perception that the commission is giving priority to probes on PA defectors when older cases are still pending.

"If the commission is to maintain its independence, the statement of Samaraweera should be recorded before December 5. Otherwise, if it is done after our victory, it would be considered political victimisation and that is not good for the commission," Senaratne said.