MBSL Insurance’s management crisis in new twist
The MBSL Insurance Co Ltd’s management crisis took a new turn with the reinstatement of Managing Director Sydney Gajanayake and the resignation of company chairman M.R. Shah with both levelling allegations and counter allegations against each other.
Sashika Senarath has been appointed as the acting chairman till the appointment of a new chairman to the MBSL, official sources said, adding that the inquiry into allegations on malpractices will be investigated at the top level.
In a statement issued to media, Mr. Gajanayake, who was suspended earlier, says that there had been no fraud or any abuse or manipulation of finances by him or the board of directors as alleged by former chairman Shah.
He noted that there was no manipulation of company accounts when paying commissions to insurance brokers which has amounted to some Rs. 13 million during the implementation of migrant workers welfare scheme.
Paying a fee for insurance brokers is a normal practice, Mr. Gajanayake said, adding that it was not his responsibility to report the financial position of the company to the board of directors.
Mr. Shah however told the Business Times that the directors of the company unlawfully, with insufficient notice, convened a meeting at which it was also proposed to review the decision placing the Managing Director and CFO on compulsory leave.
He noted that this meeting had been convened bypassing the Company Secretaries, in order to wrongfully accommodate Prof. Ranjith Bandara, who is no longer a director of the company.
The Managing Director was placed on compulsory leave on a unanimous decision of the board on 20th November, 2013, in order to facilitate an independent investigation by the Price Waterhouse Coopers to be carried out, into the irregularities in the commission payments reported by the Internal Audit investigations, he said.
In view of these developments, he said that he has tendered his resignation as the Chairman and Director of the company with immediate effect. He however continues as MBSL chairman.