Monday Nov 25, 2024
Monday Nov 25, 2024
Thursday, 14 August 2014 00:50 - - {{hitsCtrl.values.hits}}
I refer to the COPE Interim Report presented to Parliament on 5.8.2014, particularly re the paragraphs scanned from paragraph 2, under the heading ‘Ceylon Petroleum Corporation’ on page 12 thereof (see box below).
I endeavoured in the public interest, to litigate in our country concerning the above unlawful and illegal transactions to prevent colossal losses being caused to public funds.
I observe that the COPE Interim Report does not disclose the totality of the facts, whereby the reality of what had transpired had been suppressed from COPE, the Parliament and the public.
Having come to know in May 2009 that Standard Chartered Bank, in violation of the provisions of the Exchange Control Act, pertaining to Capital Account Transactions, had remitted US $ 107,778,700/-, to its Head Office in UK (admitted by Letter dated 13.5.2009 of the Controller of Exchange addressed to Standard Chartered Bank), without the prior permission of the Central Bank, and also disregarding the specific directive given on 16.12.2008 by the Monetary Board to Standard Chartered Bank prohibiting such remittance, and that Standard Chartered Bank was endeavouring to remit a further sum of US$ 20 m, I, in the public interest, promptly on 25.5.2009 filed SC (FR) Application No. 404/2009.
Consequently on 16.3.2011, acting under and in terms of Sections 51 and 52 of the Exchange Control Act, the Controller of Exchange had imposed a penalty of Rs. 27,577,019,612/- (approximately US$ 250 m) on Standard Chartered Bank, against which Standard Chartered Bank had filed Writ Application No. 409/2011 on 16.6.2011 in the Court of Appeal. 
Thereafter upon coming to know on 2.6.2009, whilst supporting the aforesaid SC (FR) Application No. 404/2009 in the Supreme Court, that Standard Chartered Bank, Citibank and Deutsche Bank had instituted legal proceedings in foreign jurisdictions, promptly on 25.6.2009, I filed a further Action in the public interest in SC (FR) Application No. 481/2009, inter-alia, seeking ‘anti-suit injunctions’ to stop foreign legal proceedings, as Sri Lanka was the proper forum.
Though, I had filed the above two Fundamental Rights Applications, in the public interest, as stipulated in Article 126 of the Constitution, well within the 30 days of the aforesaid specific acts, the then Hon. Attorney General, Mohan Peiris P.C., appearing for Ceylon Petroleum Corporation and the Secretary to the Treasury, and also as amicus-curiae, having admitted by Affidavits settled by him, that the purported Oil Hedging Deals were, inter-alia, illegal and/or ultra-vires and were null and void and/or unenforceable, however curiously vehemently objected to my Applications for the Supreme Court of our country to exercise jurisdiction - vide Proceedings of 14.7.2009:
“Mr. Mohan Peiris P.C. AG too informs Court that he vehemently objects to the Leave to proceed being granted, as he is defending the action filed abroad vigorously and the arbitrations”
The foregoing was notwithstanding, the then Minister of Petroleum Industries, having assured me that the then Hon. Attorney General, Mohan Peiris P.C., would be instructed to support my endeavours.
Finally, when the matter came up on 11.5.2010, the then Hon. Attorney General, Mohan Peiris P.C., continuing to vehemently oppose the prosecution by me, in our country, invoking the jurisdiction of the Supreme Court, pompously unequivocally assured in open Court, that he would successfully defend the foreign litigation and arbitrations, and advised me to ‘lay my head at rest’, even though I had pointed out to him that he was on the defence, whilst I was on the offence ! Contrary thereto, private Counsel appearing for the Controller of Exchange and Director Bank Supervision supported my Applications.
The Supreme Court, comprising Justices N.A. Amaratunga, S. Marsoof and K. Sripavan, upheld such objection of ‘time bar’, and in fact delivered a gravely erroneous Order, that I should I have filed my Applications within one month of 27.1.2009, on which date, the aforesaid act of unlawful remittance of monies by Standard Chartered Bank, and the foreign litigation and arbitrations never existed, thereby rendering such Order to be a farce!
It was so held, since I had endeavoured to intervene in two previous public interest actions, regarding the matter of the purported Oil Hedging Deals, but though present in Court on 27.1.2009, I was not made an Intervenient Party, since the Supreme Court terminated the said two Applications on that date, and in any case, such matter had no relevance whatsoever to the foregoing, which were distinctly different matters.
Consequently, by Letter dated 24.6.2010, recording correctly the chronology of facts, I put the then Hon. Attorney General, Mohan Peiris P.C., on notice of his foregoing unequivocal public assurance and guarantee, that no monies whatsoever of public funds would be paid to the aforesaid Banks, and that he would recover total costs incurred in spending public funds.
Making a sheer mockery of what was so held out and asserted publicly in the Supreme Court by the then Hon. Attorney General, Mohan Peiris P.C., subsequently in Case No. 209 Folio 375 in the High Court of Justice, Queens Bench Division, Commercial Court in London, in Judgment dated 11.7.2011, the Claim against the Ceylon Petroleum Corporation of US$ 161,733,500/- plus Interest from 2008 had been awarded to Standard Chartered Bank. I verily believe that the settlement referred to in the aforesaid COPE Interim Report had been a compromise, as a consequence of the aforesaid penalty of US$ 245 m, which had been imposed by the Controller of Exchange, and ought have been so fully disclosed. Thereafter, further making such assurances to be mere hollow rhetoric by Award dated 31.10.2012, the International Centre for Settlement Disputes in Washington DC awarded Deutsche Bank US$ 60,368,993/- plus Interest from 2008 and a further US$ 7,995,127.36 as legal fees and expenses. I learned that the present Hon. Attorney General had appealed against the said Arbitral Order, though the grounds of Appeal are very restrictive, and that the outcome of the Appeal is not yet known.
Notwithstanding the London Commercial High Court Judgment dated 11.7.2011 held in favour of Standard Chartered Bank having been tendered before the Arbitral Tribunal of the London Court of International Arbitration, sitting in Singapore, the Citibank Claim of US$ 194 m, against Ceylon Petroleum Corporation, was won by the Ceylon Petroleum Corporation, even thereafter by Award dated 31.7.2011 declared as null and void and ultra-vires and beyond the capacity of Ceylon Petroleum Corporation.
I verily believe that this was directly as a result of my publishing a Book released globally on 25.4.2011 titled – “Derivative / Hedging Deals by Citibank, Standard Chartered Bank, Deutsche Bank, with Sri Lanka Government’s Petroleum Corporation - Dubious & Illegal?”
According to the Auditor General, as reported in the Daily Mirror of 12.5.2014, Rs. 480 m had been alleged to have been paid as Legal Fees to defend these Oil Hedging Deals in foreign jurisdictions, whereas the Supreme Court of Sri Lanka had ex-facie restrained these Oil Hedging Deals, and I was wrongly prevented on baseless grounds from having these Oil Hedging Deals adjudicated upon in our country, resulting in the foregoing colossal losses of public monies, for which those responsible, necessarily ought be held accountable and responsible.
Hon. Attorney General, Palitha Fernando, P.C., I have noted with interest your interview published in the Daily Mirror of 8.4.2013 captioned – “We are men of integrity: Attorney General”. I attach a copy thereof, and urge you to take action, without fear or favour, regardless of the status of the persons concerned, upholding the noble principles, which you have asserted assuring the public.
Yours truly,
Nihal Sri Ameresekere, F.C.A. F.C.M.A., C.M.A., C.G.M.A., C.F.E.
Associate Member, American Bar Association
Director, International Consortium on Governmental Financial Management
Member, International Association of Anti-Corruption Authorities
