By Roy Denish.
Ravi Karunanayake seeks Parliament scrutiny over foreign exchange fraud claims involving banks, Customs and fake import payments.
Foreign exchange fraud allegations have triggered a fresh demand for urgent parliamentary scrutiny of Sri Lanka’s financial and customs watchdogs.
MP Ravi Karunanayake on Monday called for top regulatory officials to appear before Parliament. The move followed disclosures of a systemic $1 billion racket. In a letter to the Chairman of the Committee on Public Finance, he asked for several officials to testify.
They include the Central Bank governor, the director general of customs, and the controller general of imports and exports. He also wants executive compliance officers from 13 commercial banks summoned for the committee’s next session.
Foreign Exchange Fraud Under Parliamentary Scrutiny
The demand follows recent disclosures by President Anura Kumara Dissanayake and Minister of Public Security Ananda Wijepala. They referred to a major capital flight operation.
According to the allegations, the network moved nearly 340 billion rupees out of Sri Lanka over two years. It allegedly used 26,108 fraudulent telegraphic transfers and fake advance payments. However, the goods linked to those payments never arrived.
Karunanayake also blamed the Central Bank’s Banking Supervision Department and the Financial Intelligence Unit. He said they failed to detect the transactions despite automated monitoring systems. Therefore, he described the failure as an internal collapse of the domestic banking framework. He did not treat it as a minor administrative lapse.
Investigators have highlighted an organized network of 105 shell companies. These companies used accounts registered under the names of 36 low-income individuals. As a result, the entities moved 12.89 billion rupees out of Sri Lanka.
They carried out 953 transactions in less than six months before closing abruptly. Meanwhile, they bypassed normal Know Your Customer and anti-money laundering controls.
The probe also focuses on allegations against branch managers at specific commercial banks. Those managers allegedly helped the operation directly. Moreover, the illicit transfers reportedly continued after suspected managers moved to different regional branches. That detail has raised serious questions about internal compliance and supervision.
Lawmakers are also examining possible links with unregulated digital currency systems. Karunanayake had earlier warned that weak cryptocurrency oversight can fuel tax evasion and capital flight.
Investigators say poor real-time data sharing created another major loophole. Commercial bank payment networks and Sri Lanka Customs failed to share information fast enough. As a result, the discrepancies continued unnoticed for 24 months.
Karunanayake said Parliament must use its statutory oversight powers for immediate cross-examination. He warned that any failure to act would amount to a severe dereliction of public duty.
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