The latest explosive revelations of the private financial records, mainly the alleged secret offshore holdings, of Thirukumar Nadesan, a wealthy businessman with political clout, and his wife and former Deputy Minister Nirupama Rajapaksa raised many eyebrows last week.
Sri Lanka was back in the international media spotlight for all the wrong reasons as the whistle-blower-led investigation, Pandora Papers, featured the Nadesan-Rajapaksa couple among over 330 politicians and public officials in 91 countries and territories, when it disclosed a complex web of tax havens, shell companies and offshore accounts that hide the true ownership of billions of dollars in assets.
The Pandora Papers, dubbed after the Greek mythology of Pandora’s Box, were released on October 3 by the International Consortium of Investigative Journalists (ICIJ) following two years of painstaking investigations by a large team of 600 journalists attached to 150 news outlets around the world.
The information trove, consisting of nearly 11.9 million files filling almost three terabytes of data, was leaked by insiders in 14 offshore financial service providers in the British Virgin Islands, Belize, Panama, Cyprus, the United Arab Emirates, Singapore and Switzerland.
It must however be noted that there are legitimate uses for offshore companies and not all cash and property in them are connected to dirty money. Then again, the very notion that one wants to keep his or her financial activities in shadows in these offshore nooks shows that something is fishy. These notoriously opaque offshore jurisdictions provide their clients the means to shield their riches and thereby evade taxes and probes.
Hope against hope
This was neither the first time where Sri Lankans were named in expansive leaks of tax haven files, nor will it be the last. The names of well-to-do and well-connected Sri Lankans were in the Panama Papers in April 2016 and the Offshore Leaks in April 2013. Those revelations created ripples in the society for a few weeks only to die down at the break of news of the next scandal or controversy. Like many other instances, repeated assurances of probes have only been until the furore subsided, and several years down the line, those have come to nothing.
Expecting investigations into any high-profile case to end with convictions at the Court under any Government without changing the prevailing socio-political culture that plagues this country is no different to expecting pigs to fly, some independent political commentators opine. The ever-growing nexus between politicians and businessmen, their shadowy wheeler dealings and the deep-rooted culture of impunity have been and will continue to be the bane of this country’s growth, they point out.
In this context, the media and the civil society have a bigger role to play to keep tabs on ‘Politically Exposed Persons’ and investigate and expose illegal or unethical activities. If one is genuinely interested in stopping the rot, advocating on whistle-blower protection and empowering journalists and civil society activists as watchdogs groups will be somewhere to start. This is no easy task given that the prevailing domestic media culture lacks appetite for investigative journalism and is prone towards click-bait and yellow journalism.
Murky waters
The initial reactions of the ruling party politicians on the matter were aimed at distancing their Party and the Government from the duo, who were at the centre of controversy. Some of them went on to question the credibility of the leaked information while playing down its seriousness. They argued that some of the leaked files dated back to 1990s, which is true, but they have somehow missed to see that the couple’s offshore financial transactions as recently as 2018 have also been questioned by the ICIJ.
Nadesan has allegedly incorporated offshore companies and trusts, namely Sri Nithi Trust, Nadesan Trust, Pacific Trust, Pacific Commodities, Pallene Investments, Chalan Oil Exploration, Concord Assets, Rosetti and Red Ruth Investments, in known tax havens such as Jersey, the Cook Islands, Samoa and Hong Kong. The ICIJ has alleged that Nadesan and his wife used a shell company controlled by them to buy luxury apartments in London and Sydney, and to make investments. It has also alleged that Nadesan used his shell companies and trusts to buy artwork, which included 31 valuable paintings.
Writing to the President last Wednesday, Nadesan broke his silence on the matter and stressed that he and his wife are “totally innocent and guilty of no wrongdoings”. He called for an independent investigation, preferably led by a retired appellate court judge, to probe the matter, so that they can clear their names.
Heated debate
Building upon the ICIJ’s report, JVP Leader Anura Kumara Dissanayaka, in a 30-minute blistering speech in Parliament last Friday, came up with more allegations of shady deals between the Chinese CAMC Engineering Company Limited, the contractor of the Gin-Nilwala Diversion Project, and Red Ruth Investments, a shell company allegedly owned by Nadesan.
Opposition Leader Sajith Premadasa pushed for an internationally recognized investigation on the secret financial transactions of Sri Lankans mentioned in the Pandora Papers. “The Pandora Papers expose the gulf between the political and business elite and the working class and the poor in Sri Lanka. While some people only a few kilometres away from Colombo can barely afford a meal, lack basic sanitation facilities, some of Sri Lanka’s political elites have wealth that is beyond the wildest dreams of ordinary citizens,” he said in a press statement.
Last Friday’s Adjournment debate on the ‘Mid-Year Fiscal Position Report 2021’ in Parliament was filled with a heated exchange of words on allegations of embezzlement and their impact on the economy. Whenever the main Opposition tried to point its finger at the Government, it was stumped by those in the Government ranks with a simple question as to why those allegations could not be investigated under the previous Government. Realizing that their past failures are haunting them, Samagi Jana Balawegaya (SJB) MP Field Marshal Sarath Fonseka conceded before the House that the previous ‘Yahapalanaya’ Government could not live up to the expectations of the people as it was led by “two of the weakest leaders in history”.
Probe launched
Former Deputy Minister Nirupama Rajapaksa and her husband Thirukumar Nadesan.
President Gotabaya Rajapaksa, taking the example of the likes of Pakistani Prime Minister Imran Khan on the matter of alleged offshore financial abuses, last week ordered a prompt inquiry into the Sri Lankans and the related transactions revealed in the Pandora Papers. The President has directed the Commission to Investigate Allegations of Bribery or Corruption (CIABOC) to submit a report in this regard in a month.
While it was the right thing to do, the Government also has to do everything within its reach to uplift the public confidence on this central anti-graft body. The report card of the CIABOC is not very impressive and one may ask how many big fish it has caught. On the other hand, a complex financial probe of this nature, which involves secrecy jurisdictions, will require expert knowledge and technical assistance. It will be a lengthy process as the findings have to be solid if those are to be proved beyond doubt.
The anti-graft Commission has already received at least three complaints on the matter. In addition, several civil society groups have requested the relevant authorities to probe the Declarations of Assets and Liabilities former Deputy Minister Nirupama Rajapaksa had submitted to Parliament and the National Election Commission when she was a public representative.
Staying the course
Meanwhile, the President made some reflective comments on his Government’s performance while taking part in the Anniversary Celebrations of the Army at the Gajaba Regiment Headquarters (the President’s old Regiment), Saliyapura, Anuradhapura, on Sunday. Admitting that his work plan was significantly distracted due to the COVID-19 outbreak, he however pledged to stay on track and work with new vigour in the new normal post-pandemic period to fulfil his pre-election promises.
Renewing his promises, he underlined that his Government would next year bring in a new Constitution together with a new electoral system, and adhere to the motto ‘One country and one law’ in practice.
Commenting on confronting corruption, the President reiterated his commitment to that task. “The people expected me to end corruption. I appointed military persons to senior positions with that in mind. At all levels, whether ministers, MPs or officials, we must eradicate corruption for the sake of the country. I have set an example, and I expect the Cabinet to do the same,” he stated. The President’s speech was almost an address to the Nation that contained many important points and both the electronic and print media gave wide coverage to it.
His remarks came at a time when doubt and disillusionment were creeping into the minds of the people as a result of the skyrocketing Cost of Living and certain unpopular decisions of the Government. He did not try to hide this fact, but made it clear that he was not blind to it. The President’s words were heartening as they indicated that the Government led by him is not impervious to public criticism and is determined to do better.
– Daily News Sri Lanka
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