Mahapola Scholarship Trust Fund suffers staggering losses due to irregularities

COPE Chairman Charitha Herath, MP (second from left) is flanked by officials (pic courtesy Parliament)

COPE PROBE

By Saman Indrajith

A probe conducted by the parliament watchdog Committee on Public Enterprises (COPE) has found that the Mahapola Higher Education Scholarship Trust fund incurred a loss of Rs. 673 million from an online lottery, Parliament sources said yesterday.

 It was revealed that Rs 673 million had been earned by an intermediary, who sold the lotteries but did not return the proceeds to the Mahapola Trust Fund.

 In addition, due to insufficient capital gains on securities transactions of companies under the Mahapola Trust Fund, in 2015 and 2016 Rs. 18 million and Rs. 102 million were lost respectively. It was also revealed that a loss of Rs. 13 million had been incurred during the repurchases made using investments in National Wealth Corporation in 2017. The COPE stressed that these irregularities had caused huge losses to the Fund.

COPE Chairman Prof Charitha Herath instructed Secretary to the Ministry of Trade JM Bhadrani Jayawardena to inform the Attorney General of the losses and irregularities and lodge a complaint with the Criminal Investigation Department.

The COPE investigation conducted at the Parliamentary complex last week was attended by State Ministers Susil Premajayanth, Dr. Nalaka Godahewa, MPs Eran Wickramaratne, Nalin Bandara Jayamaha, Premnath C.Dolawatta and S. M. Marikkar.

The committee also recommended a proper study on the irregularities with regard to the National Wealth Corporation and the National Wealth Securities Corporation, under the Mahapola Trust Fund and ordered that the heads of the institutions be summoned before the COPE forthwith.

The officials who attended the investigation told the committee that the Cabinet had approved the liquidation of those institutions as they were running at a loss. Commenting on this, COPE Chairman Prof. Charitha Herath said that although it would not be a problem to liquidate after punishing the culprits, it would not be appropriate to liquidate those institutions without proper investigation into frauds.

COPE Chairman Herath said that the liquidation should be delayed until those irregularities were properly investigated.

The current situation of the Sri Lanka Institute of Information Technology (SLIIT) was also discussed. The committee expressed its displeasure at the fact that even though the SLIIT had been summoned before the Committee it had informed the COPE through Julius & Creasy law firm that it had not been legally bound to do so. Thus, the COPE decided that law firm Julius & Creasy should be summoned to resolve the matter.

The COPE Committee further recommended that as SLIIT was an institution of national importance, after preparing an internal report as an extension of the discussion on that institution and reporting it to Parliament, it would be appropriate to decide on the action to be taken in that regard.

Further, it was revealed that the institution did not have an internal auditor and an accountant. The COPE Committee recommended that action be taken to fill the vacancy as soon as possible, according to sources.