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Thu, 23 November 2017 03:39:18
Golden Key Depositors to withdraw all complaints: Central Bank to bare costs (In Pics)
13 May, 2015 16:45:02
By Anushika Kamburugamuwa
May 13, 2015 (LBO) – Sri Lanka’s golden key depositors were asked to withdraw all cases to be taken up by the Supreme court on 18 May 2015 following a assurance of 40 percent pay back by the Central Bank.

“We are here to facilitate and to ensure that they (depositors) are provided the relief that they are longing for,” Ravi Karunanayake, Finance Minister of Sri Lanka said today at a meeting held with Golden Key depositors.

The Golden Key Credit Card Company collapsed with debts of 26 billion of which 12.7 billion is capital and 13.2 billion is interest according to initial findings of a Supreme Court appointed committee of chartered accountants.

The committee had said two sets of accounts were found and some assets have already been mortgaged to other parties, complicating a liquidation process.

Golden Key ran a ponzi-style high yield investment scheme which did not have enough revenue generating cash flows to sustain the high yields promised to investors.

Directors of the firm including Lalith Kotelawala were imprisoned and now are now out on bail and the whereabouts of Kotelawala's wife is unknown.

All the depositors who were present at the meeting agreed to withdraw the court cases but asked a written assurance.

All the cases are to be taken up on 18 May 2015.

“We will give this in writing at the court when all the cases are withdrawn and there on wards it is the Central Bank dealing on your behalf,” Karunanayake said.

He said the depositors who had less than two million will get paid less than one month while the depositors who had deposits of 10 million will get paid less than two months and the balance will get paid in less than one year.

However there was a request by a depositor asking to pay one million rupees for all the depositors in the first month.

“We will look that and agree upon it go forward,” Karunanayake said.

“This is the only way that innocent depositors will get paid as much as they can.”

He said there will be a committee formed there after representing 15 depositors, co-opted by the governor with a management team and with an auditor to go to every single consumable asset known and unknown to the Golden Key to trace and probe.

The cost will borne by the Central bank.

“If we get more than what we can get which was agreed, that all benefits will be given to the depositors,” Karunanayake said.

“There won’t be single benefit that will be taken by the Central Bank all costs here on wards until the matter is fully closed will be borne by the Central bank.”

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READER COMMENT(S)
3. Leo May 14
Except that the CBSL, during the tenure of its former governor, had full knowledge of GK and allowed it to function unhindered, thus neglecting its responsibility as the financial watchdog. So it's the moral and legal responsibility of CBSL to intervene especially as Lalith Kotelawala has alleged on public television that GK accepted "black money". In other words, CBSL has approved, indirectly, an institution under its purview to operate a money laundering business. And to make matters worse, the present authorities are publicly requesting that all directors of GK responsible for this fiasco and illegal activities be allowed to get off scott-free in exchange for releasing only 40% of the depositors' money! Does anyone smell anything here?
2. Niro May 14
CBSL is setting a bad precedent. CBSL should not bail out the depositors who knew the risks of investing in a scheme which promised 30% annual returns! Somebody who has 'invested' 10 million can't be labeled as a 'innocent depositor'!
1. KS May 13
See where greediness has end?