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Anything but a ‘safety’ fund

Sunanda Deshapriya

By Mandana Ismail Abeywickrema 

Stunning new evidence has now unfolded against the role of media activist and former Free Media Movement (FMM) Convener, Sunanda Deshapriya’s involvement in the alleged misappropriation of FMM funds as well as those under the Safety Fund set up for the protection of journalists under threat.

Not only has an FMM audit found Deshapriya guilty of having dipped his hands into the till during his tenure, but more astounding is the disclosure in this report that a total sum of Rs. 4.2 million allocated to the ‘Safety Fund’ has been spent.

This astounding state of affairs came to light after Chairman, Sri Lanka Press Institute (SLPI), Kumar Nadesan in a letter to the FMM dated March 17, 2009 called for the cancellation of the Fund saying  that apart from the Rs. 1.9 million that has been accounted for, the remaining Rs. 2.2 million must be returned to the SLPI.

However, the audit query found that the bank balance of the FMM as at March 31, 2009 was Rs. 114,403.41 while the cashbook balance was recorded as Rs. 42,215.41. The audit report however stated that the total amount of the Safety Fund, of Rs. 4.2 million appears to have been spent.

Financial misappropriation

The FMM in the meantime, in its audit report submitted at its Annual General Meeting held last Tuesday (26) admitted to the financial misappropriation charges levelled against its former Convener, Deshapriya during the periods 2007/2008 and 2008/2009.

As reported in The Sunday Leader last week, the FMM audit report corroborates the financial irregularities that have taken place with regard to the Safety Fund set up with funds provided by the Sri Lanka Press Institute (SLPI). 

Among recommendations made by the auditors who conducted the FMM audit is the need for a proper accounting system to overcome the problems created due to a weak financial management system.  The auditors have further called for a separate investigation to look into the issues with regard to the missing monies allocated to the Safety Fund.

According to the audit report, the first finding was that the institution during the said period had not maintained financial documents that were necessary for sound financial management.

Doubts over receipts

The audit has also raised doubts over a sum of Rs. 192,000 received by the FMM from the IFJ that was unaccounted for a period of seven months. The report states that no such payment was received by the FMM after March 31, 2008. The monies received in the financial year 2007/2008 were kept by Deshapriya from March 31, 2008 till October 31, 2008, when he deposited it in the FMM bank account. However, this amount has not been indicated in the final accounts of 2007/2008.

The audit report has questioned why Deshapriya failed to declare a sum of Rs. 192,000 for a period of seven months.

The FMM audit inquiry also found that while Deshapriya had claimed Rs. 13,200 as transport charges through voucher number 7/45 in July 2008, the bill attached to the voucher was a fuel bill amounting to Rs. 5,800. The audit has queried as to what had  happened to the remaining Rs. 7,400.

Among the many irregularities highlighted in the audit report are matters relating to payment vouchers.

The audit report states that while payment vouchers have not been duly numbered they are incomplete in that the necessary bills had not been attached. In some instances there were doubts if payment vouchers had been released for transactions.

No Cash Book

The non maintenance of a cash book has also made it difficult for the auditors to compare the cash book entries with the bank balance.

The non existence of a petty cash book has also resulted in no proper data being available of financial transactions that were made during this period, the audit report states.

The report adds it was unusual to witness a shortfall in petty cash noting that, “This is not the financial management system of a good organisation.”

The audit further found that some payments had been made through both payment vouchers as well as petty cash vouchers.

In some instances the payment vouchers do not have the signature of the recipient of the monies. For example, a sum of Rs. 140,500 had been paid to ‘Holiday Resort Traveling’ for an air ticket for Sunil Jayasekera through payment voucher number 5/01 and cheque number 812648. However, the voucher had not been signed by the recipient.

When questioned by the auditors, Jayasekera has said that the money should have been taken back after deducting the commission from the travel agent and deposited in the bank as he did not make this trip as initially planned. However, the audit has revealed that the monies initially taken for the purchase of this air ticket have not been re-deposited in the bank during 2008 or 2009.

Accounts advisor

The FMM has also incurred expenditure that did not benefit the organisation in any way.

One such expense was money paid to one I. Ramesh for performing duties as a financial management advisor and accounts advisor to the FMM. While a sum of Rs. 40,000 had been paid to this person for this purpose financial management at the FMM remained in an appalling state.

There are more discrepancies regarding workshops conducted by the FMM.  For instance,  the report states that a sum of Rs. 42,500 had been released by payment voucher number 4/07 in April 2008 as payment for the instructors of a workshop in Kalutara sponsored by the ‘Fredric Ebert Stiftunge organisation.’

The two vouchers presented for the payment indicates that a sum of Rs. 5,000 was paid for the trainer of the workshop in Vavuniya and Mannar while Rs. 20,000 had been paid for the trainer of the workshops in Galle, Matara, Kurunegala and Kegalle. A sum of Rs. 17,500 remains unaccounted for following these two transactions.

In April 2008 six persons have been issued Rs. 10,000 each through cheque number 812615 amounting to Rs. 60,000. The recipients have however, not signed the voucher acknowledging receipt of the monies.

A sum of Rs. 26,117 had been issued to ‘BDP Travels’ for a trip to Medawachchiya. But the date of the trip, the purpose and the name of the person who used the vehicle was not available.

The audit report states that it is also unclear if cheques issued were cash or addressed to an account.

According to the FMM audit report, the non-maintenance of relevant account books has made it difficult to identify donors thereby making it impossible to ascertain from where and from whom, funds amounting to some Rs. 2 million had been received.

Sunanda Deshapriya’s explanation

We reproduce below — unedited — an email circulated by Sunanda Deshapriya following The Sunday Leader article last week on the misappropriation of monies belonging to the Safety Fund: 

Dear all FMM members,

Today (May 24) Sunday Leader has carried an article on FMM Safety Fund and accusing me for misappropriation of money. This SLPI report has been leaked to Sunday Leader just two days before its AGM.

Under the Safety fund FMM did a great service to safeguard of lives of media freedom activists and threatened journalists. It was 5 media organistaions led by FMM, which defend media freedom in the face of unprecedented media suppression in Sri Lanka.

Leaking of this SLPI document to the Sunday Leader is also part of the plan to destroy FMM and other media organizations various persons with vested interests.

Sunday Leader story has number of inaccuracies; some of them are fellows. I propose that FMM write a reply to Sunday Leader after the AGM.

SLPI did not send me this report.

I was given a report on 15th May 2009 by FMM convener and I have sent my comments on the same day,

FMM sent the draft narrative report last October and steering committee approved it in general and after that revised report has been sent to FMM by my self.

My responsibility in FMM safety fund was implementation of activities, I have implemented activities as in the proposal in consultation with the steering committee, accounts were the responsibility of the treasure.

On resigning from Safety fund steering committee on conflict of interest – it was decided only on October steering committee meeting for both my self and SLPI DG Ranga Kanasooriya to resign, I resigned as soon as it was decided by the steering committee.

Personally I do not agree with the number of points raised in the SLPI audit report, SLPI should have had a discussion with FMM before making a claim to return the money

FMM convener gave me a copy of SPLI report on 15th May for my responses, I sent  my responses within two hours: they are fellows.

Sunanda Deshapriya,

17th May 2009.

My comments to SLPI letter dated March 21 2009 to Convener FMM

The approach of the letter is inappropriate. Before asking FMM to return any funds SLPI should have held discussion with FMM. Auditors too should have discussed with FMM before making final report. There was no discussion held with FMM by the auditors appointed by SLPI.

Advance payment to Poddala Jayantha rented house   – His rental period only cones to an end by July 2009. This baseless claim.

Advance payment to Sanath Balasuriya rented house  - for safety reasons Santh Balasuriya has left the country. FMM need time to communicate with him

Altered and false payments:

1. Door intercom was installed by the landlord him self. FMM do not check the address of bills. Auditors should have talked to the Landlord before making this claim.

2. FMM would like to see these bills before making a final dicision.

3. Office rent – FMM want to know how SLPI obtained FMM project proposals and want to know whether it has any right to look in to FMM proposals without FMM permission. FMM has not claimed all rents form other proposals.

4. Coordinator salary – missing voucher can be re-produced without any problem.

5. Printing post cards – quotation can be produced. There is not obligation in the agreement to provide quotations for all safety work. These activities done in hurry and with some secrecy for safety reasons.

6. Payment to Vincent Jeyan – He has left the country for safety reasons. FMM need time to sort this out.

7. Double payment – Need to check with Vincent Jeyan again.

8. Payment to Lanka E news was for a protest poster, SLPI letter does not indicate what is the issue with this payment.

9. Mobile payment. – this was a block  payment, no bills were required,.

10. Mobile payment – need to check

11. Payment paid journalists families – need to check. In this case aditors should have checked with the families if they receive the money or not as they have checked with Supermarket bills.

12. Need to check.

13. CMEV expenses – This is a wrong entry. This trip was made to meet eastern province journalists to ascertain the safety issues during the election time. This only need to change the entry.

14. Need to check. Difference is only 40.00 SLR.

15. Participant list can be provided, FMM can provide evidence that course was held.

16. Purchase of Laptop – this was explained to steering committee meeting held in October and approved. FMM decided to buy the laptop for safety reasons. Desk cannot be carried home to work any time of the day. Sanatha Balasooriya who used the laptop was moving from place to place in those days.

17. Need to check and can be ratified.

18. Need to check and can be ratified

19. Laundry bill was on the person who went to the laundry.

This letter shows SLPI’s total inability grasp the situation FMM and its activist worked under unprecedented media suppression. Any Safety fund has to be flexible. FMM never sent a project proposal to SLPI. FMM want to know where this funds came and why it was given to SLPI.

Sunanda seeks money from same fund for Geneva trip

Despite standing accused of misappropriating millions of rupees from a Safety Fund for which monies were given for the protection of journalists under threat, Sunanda Deshapriya has on May 5, written asking for more monies from this same fund to be given to him to go to Geneva to attend a conference on human rights.

Following is the e-mail message sent by Deshapriya:

---------- Forwarded message ----------

From: Sunanda Deshapriya <>

Date: Tue, May 5, 2009 at 10:23 PM

Subject: safety fund

To: Johan Romare <>, Henrik Grunnet

<>, Thomas Hughes <>, Ranga

Kalansooriya <>, Sonny Inbaraj Krishnan

<>, sam de silva <>


Dear all,

As you may know FMM safety fund has allocation to travel to HRC

Geneva to engage in Press Freedom Advocacy,

But Fund is not active yet, money is getting rusted while we do not have funds to do advocacy as planned,

Is there anyway funds allocated to Geneva advocacy can be utilized or

SLPI safety fund supporting my travel and daily expenses, I am trying to raise funds to be there for the June secession of HRC,



Explanation for the delay in banking Rs.192,000 

Below we reproduce — unedited — the email circulated by Sunanda Deshapriya in response to the findings of the FMM audit report: 

Dear all,

I have received FMM internal audit report from sources other than FMM. FMM has not sent this to me yet.

First I like to know who leaked this to media?  Who had the soft copy?

I think best course of action would have been to submit report of recommendations to FMM AGM until persons named in the report get a opportunity to respond. It is unethical to make a report publish without giving a time for persons named in the report to respond.

No organistation make detailed internal audit reports public, I know this from CPA very well. Now this report has made public I  need to make this calcification:

The auditors never asked me for explanation on the entry on SLR 192,000 I handed over to FMM.

The report says I have kept he money for 10 months or so.

That is wrong.

I only received 180,000 to be sent to IFJ in February,  and as I couldn’t send the money aborad because of  foreign exchange regulations I handed over 192.000 to FMM (Accountant Faizal)  in early June, 12.000 being the interest for the 180,000.00 in three months, Sandamali Devcasurendra can be a witness for this if auditors to find out.  If the money was not banked in June that has to be inquired from Faizal Anser, the accountant of CPA,

As this money came form a CPA proposal and CPA asked me to return the money without interest I handed over another SLR 180,000.00 to CPA in December 2009.  As I have paid the money to CPA now this SLR 192,000.00 is paid form my personal savings.

The auditors could have get in touch with me easily if they wanted.

According to the FMM constitutions it is the treasurer, who is responsible for r keeping accounts,

I have not interfered with accounts in my involvement in FMM at all in any time. All treasurers will confirm that.



Poddala Jayantha’s response to the audit query 

Following the article published in last week’s The Sunday Leader on the misappropriation of the Safety Fund, Secretary, Working Journalists’ Association, Poddala Jayantha has sent a response to the query raised in the SLPI audit report.

The SLPI audit report called on Jayantha to return a sum of Rs. 50,000 paid from Safety Fund monies, as a deposit for a safe house taken for him.

Below is an English translation of Jayantha’s response which was sent to us in Sinhala:

“I had to intervene in a lot of situations as secretary of the Sri Lanka Working Journalists’ Association in the recent past during severe suppression of the media. It is a well known fact that my life was under great threat as I opposed the suppression of the media. After the police visited my house at night, I had to leave my residence to find a safer place. My house was located in an area called Diyakada, which is about 8 km from the Kahatuduwa junction on the Colombo-Horana Road.

Considering the situation, the Free Media Movement that was handling the Safety Fund established with the Sri Lanka Press Institute, got me the house at the above mentioned address (...... Nugegoda), for a period of one year. The house was taken on rent after a legally binding lease agreement and registering it at the Land Registry. (Copy of the lease agreement attached to the letter.)

 Apart from a one year rent advance, the house owner also kept another Rs. 50,000 as security deposit that would be returned after the lease period comes to an end. The lease to this house comes to an end on June 18, 2009.

While I’m planning to vacate this house by June 20, 2009, the house owner would release the above mentioned Rs. 50,000 at that time. The monies would be immediately handed over to the Free Media Movement, which would in turn hand it over to the Press Institute.

The funny thing in this whole issue is that while a copy of the lease agreement has been given to the Press Institute, on letter dated March 21, 2009, they have requested for this Rs. 50,000.

I came to this safe location after vacating my house because my life was under threat. While a copy of the lease agreement was given to them and a request made not to publicise it as the document contained the address that is supposed to be kept a secret, the Press Institute released the address to a private audit firm to investigate the house I was living in for my safety.

It is also interesting to note that those who came to investigate did not even possess an ID issued to them by the respective audit firm. It is in this manner that the Press Institute revealed the house I was living in for my safety.

Poddala Jayantha







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