The Auditor General (AG) has highlighted financial fraud of Rs.108 million committed by 63 banks and banking societies from 2014 to 2016 after the establishment of the Divineguma Development Department.
The AG in a special report on the Samurdhi Subsidy Programme, highlighted that even though financial fraud had been revealed in 25 banks and banking societies during the said period, the value had not been computed, the report added.
The audit report said more financial frauds amounting to Rs.12 million had been revealed in 18 banks and banking societies under the Sri Lanka Samurdhi Authority. “It has been revealed that a financial fraud is committed annually in Community Based Banking and Banking Society Systems. However, investigations have been conducted in a sluggish manner. As such, it was observed that failure to recover losses and to impose punishments by revealing offenders, had affected the increase in frauds,” the report said.
The audit investigation carried out in September last year had also revealed that Rs.102 million in the Samurdhi Social Development Trust Fund had been utilized for other purposes. “The monies of the Fund, raised from the contributions of Samurdhi beneficiaries had been utilized for other purposes, deviating from programmes on uplifting Samurdhi beneficiaries for whom that Fund is established,” the report said.
The audit report observed that prompt action had not been taken in respect of parties responsible for financial frauds and in recovering of those amounts.
It further observed that specific policies had not been formulated on empowering Samurdhi beneficiaries during a specific period, making them self-sufficient and withdrawal from the programme. The monies allocated for development programmes on empowering Samurdhi beneficiaries, had not been spent in a planned manner to cover the whole island, it added.
“Even though it had been emphasized by circulars that Samurdhi subsidies can be obtained by Samurdhi beneficiaries at any time, balances ranging from Rs.154 to Rs.106,000 had remained in 175 Bank Accounts of 12 Community Based Banks which were subjected to audit. Moreover, they had been persuaded to obtain loans ranging from Rs.1,906 to Rs.337,200 under various loan programmes by delaying payment of subsidies to beneficiaries. Further, it was observed that subsidies had been paid once in 2 or 3 months and the balance of subsidies had been retained to reconcile with loan balances and settle them,” the report highlighted.
According to the report, the total cost borne by the Government for the Samurdhi Programme amounted to Rs.126,514 million during the period from 2012 to 2016. Out of that sum Rs.121,801 million had been spent on the subsidies for the upgrading of living standards of Samurdhi beneficiaries and Rs.4,713 million had been spent on the Samurdhi development.The expenditure on subsidies had been increased by 167 per cent and 170 per cent in 2015 and 2016 respectively as compared with the year 2014.
The total benefits received per one Samurdhi beneficiary had increased from Rs 11,736 in 2014 to Rs 29,706 in 2016.