Ex-CBSL Chief Cabraal and four others released in Greek bond case

The Colombo High Court yesterday ordered the release of former Central Bank of Sri Lanka (CBSL) Governor Ajith Nivard Cabraal, and four other defendants in a case filed against them for allegedly causing financial losses to the Sri Lanka Government through investments in Greek treasury bonds in 2012.

The release follows objections raised by Cabraal’s Attorneys, who argued that the case filed by the Commission to Investigate Allegations of Bribery or Corruption (CIABOC) could not be maintained. The Defence Attorneys highlighted that this case was filed a decade after the Supreme Court issued a determination regarding the incident. They also noted that the charge sheet was signed by the CIABOC Director General before his official appointment to the post.

Colombo High Court Judge Adithya Patabendige accepted these objections and ordered the dismissal of the case.

The defendants Ajith Nivard Cabraal, Dharmasena Deerasinghe, Wasantha Ananda Silva, Chandrasiri Jayasinghe Panditha Siriwardena and Harankaha Arachchilage Karunaratne were accused of causing a loss of over Rs. 1.8 billion to the Sri Lankan Government through Greek treasury bond investments made in 2012. On 3 May 2024, Cabraal’s Attorneys raised preliminary objections, leading to today’s decision.

The Bribery Commission had filed indictments against the defendants, claiming they were responsible for the substantial financial loss incurred by the Government.

The controversy dates back to 2012 when Sri Lanka invested in Greek treasury bonds amid the European debt crisis. The investment decision, overseen by then CBSL Governor Ajith Nivard Cabraal, was heavily criticised due to the high risk associated with Greek financial instruments at the time.

CIABOC had filed legal action against the five persons based on a complaint by former MP Sujeewa Senasinghe. In his complaint, Senasinghe alleged that the Central Bank purchased treasury bonds issued by the Greek Government in 2012, during a period when Greece was experiencing a severe financial crisis.

Senasinghe had alleged that despite being aware of the financial crisis in Greece, the Central Bank proceeded with the purchase, resulting in a loss of over Rs. 1.84 billion to the Government of Sri Lanka.