Dinesh urges CB to take action against cheque fraud
UPFA-MP Dinesh Gunawardena said cheque fraud is a billion rupee problem facing the Central Bank (CB) today. Many businessmen and traders issue cheques without adequate funds.
“In the Colombo city limits alone, there are thousands of people caught up in this issue. So why is the Central Bank not taking action? Why is the banking law silent? Nothing is being done and as a result the chain of the economy is coming to a standstill in these areas and this is a very grave situation.”
He said the Debt Conciliation Board had taken many measures during the past several years to reduce the backlog of cases pertaining to debt related disputes. But, it is doubtful whether this issue can be resolved by merely increasing the staff numbers. The reason is that almost every village in the country is caught up in the short term loan trap, especially the elderly. Then there are the pensioners, those engaged in the labour trade and the housewives. All of them are caught up in the debt trap, the MP noted.
Giving an example he said, “In Pettah daily there are lenders who give money on interest and for Rs.1000 the daily interest is Rs. 100 which is multiplied by 30 if it is for a month. This is the same method that has gradually crept into villages as well and there are upper banks that give out housing loans under this same method. He commended Justice Minister Thalatha Atukorale for taking measures to mediate in resolving this issue.”
Joining the Debt Conciliation Amendment Bill debate in Parliament yesterday, Gunawardena said there are many unregulated loan schemes and some companies go to every village and town and give sell goods on such schemes and in some instances, people have to pay around 40% in interest. The majority of those who get lured into such schemes are the women folk.
“Even in villages, prior to sowing their fields, they pawn their lands and obtain loans in addition to the government loans. Hence, it is a very dangerous predicament for many, especially those with limited income,” MP Gunawardena added.
While commending the efforts of the Justice Minister to introduce measures to address the issue of resolving the disputes pertaining to obtaining of loans, he called on her to revisit this issue and take further measures to address the broader issue, in terms of obtaining and offering loans.
He also brought up the issue of cooperative association funds that they have lent to finance companies, which have since collapsed and the monies of the depositors are lost. He pointed out to the Justice Minister that the offenders have so far not been brought to book.
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