Treasury Bond Inquiry Samarasiri, Geoffrey Aloysius, three others get bail

By Shehan Chamika Silva  -6 April 2019 

Central Bank’s former deputy governor P. Samarasiri, Perpetual Treasuries Chairman Geoffrey Aloysius and its directors Pushyamithra Gunawardena, R. Hulugalla and M. Surendran were  released on bail by Colombo Chief Magistrate Lanka Jayaratne yesterday.  

Mr. Samarasiri and Mr. Aloysius were each released on a cash bail of Rs.100,000 and two sureties of two million rupees while the three directors were released on two sureties of one
million rupees each while their passports were impounded.
Even though the allegations levelled against the suspects are bailable on the discretion of the Court, on the earlier occasion the chief magistrate pointed out that under Section 14(1)(B) of the Bail Act the suspects were alleged to have been involved in an offence where large amount of public money was misappropriated and as such the Court had reason to believe that the particular gravity of and public reaction to the alleged offence may give rise to public disquiet. Therefore, the Magistrate rejected to bail application on that occasion.  

At the onset of the inquiry, Senior Deputy Solicitor General Haripriya Jayasundara informed Court that the prosecution has also pointed out some details in the further report seeking remand extension of the suspects. However on the last occasion the prosecution did not request from court to remand the suspects.  

Appearing for Mr. Aloysius, Senior Counsel Jeewantha Jayathilake addressed the issue relating to the public disquiet and said there had been no protests against these suspects which could be regarded as public disquiet. “ We could have said that initially there was a public outcry on this matter but now more than 13 months later since the arrest of Mr. Aloysius and Palisena the public outcry had gradually reduced,” Counsel said.  

President’s Counsel Upul Jayasuriya appearing for Mr. Hulugalle said being a director alone cannot be considered as an offence committed under the Registered Stocks and Securities Ordinance and in this instance the law required special provisions to level strict liability on directors over the offences.  

He cited some of the latest SC decisions with regard to the prevention of possible arrests of former navy commander and former defense secretary and said even though those cases were in relation to the abduction of 11 youths and huge amounts of public funds being allegedly misappropriated, there had been no public disquiet in those cases.  

President’s Counsel Nalin Ladduwahetti appearing for the former deputy governor said the allegations leveled against his client are compoundable offences. He said the public disquiet is not connected with his client as his name came to known two weeks earlier. The Counsel said also of the view that the public disquiet which may have happened thirteen months ago is now reducing. He said during the questionable bond auction his client had done everything in his official capacity and therefore there could not have been any conspiracy.  

The Magistrate after considering the submissions observed that suspects had never attempted to abscond from the inquiry and neither had they interfered with the evidence and do no have reports of similar wrong doings in the past. Even though the charges leveled against them has some serious concerns, the Court had considered the downward trend in the public disquite and that the suspects had been in remand custody for two weeks before releasing them on bail.  

Five directors of PTL have been named as suspects in the inquiry. However, one director named Ajan Punchihewa is reported to have gone abroad. Acceding to the prosecution’s request Court directed to issue a notice via express mail to the suspect to appear before the CID to record statements. 

The prosecution has levelled allegations against all directors over the violation of the Section 56(A) of the Registered Stock and Securities Ordinance (RSSO)  

The prosecution also levelled allegations against them for abatement and conspiracy arising out of the violation of the above section of the RSSO.  

The prosecution also levelled allegations separately against former deputy governor P. Samarasiri over the violation of the Section 56 of the RSSO and conspiring with former governor Arjun Mahendran to commit the main offence. P. Samarasiri was the Tender Board chairman during the February 27, 2015 bond auction.  

All these allegations were levelled parallel to the allegation levelled previously against Arjuna Aloysius and Kasun Palisena accusing them for abetting and conspiring with Arjuna Mahendran to misappropriate public funds worth Rs.688 million during the bond auction on February 27, 2015.  

The case was postponed for April 30, 2019