Finance companies allowed to drift away with our hard earned savings

Under the regulatory and supervisory dictatorship of the Central Bank, there were 32 Finance Companies, as per the regulations prescribed under the Finance Companies Act No.78 of 1988, during 2008. The Central Bank quite proudly campaigned through the print media for the public to utilize the attractive fixed and savings deposit schemes, made available by these 32 Finance Companies.

While “Golden Key” was not registered with the CB, Dr. Lalith Kothalawela being the head of same, declared that GK provided, above normal interest rates to those who invested with GK, including those who successfully converted “black money” into “white”. Where was the Monetary Board of Sri Lanka, when a colossal sum of around 10 Billion rupees was disbursed to the investors of the fallen GK company, as soon as the present government with “Yahapalana Principals” came to power?

Now, the Central Bank has accommodated 46 Registered Finance Companies, under the new Act No. 42 of 2011, for finance business.

The general public, specially those who are retiring from employment, would seek the guidance of the Central Bank, as to whether the 46 Finance Companies, presently existing are suitable, for investment of their retirement benefits, to ensure humanitarian safety for their families.

This prudent question is raised by the general public, especially based on the recent media reports, that several registered finance companies, have totally failed to even refund the legitimate deposits placed by their valued depositors, over the past 6 to 7 years, and those aged, retired depositors and their innocent families are facing difficulties as a result in spite of the regulatory powers exercised by the Central Bank, over these companies.

Over the past 7 years, streams of depositors in several Finance Companies and their immediate family members, have been subjected to unimaginable trauma due to the blunt refusal of the said finance companies, to refund their legitimate savings. Deaths have been reported, due to lack of finances for medication. Educational activities and even marriages of family members, have been stalled, due to the unexpected breakdown of finances, arising out of the actions of these finance companies.

Quite contrary to the mighty powers vested upon the CB and the Monetary Board, to protect the depositors of the registered finance companies, the fraudulent administrators of these companies have been permitted to drift away craftily, with the hard earned savings of the innocent depositors.

On the other hand, the remaining assets left with the said companies, which would have compensated the depositors, are being allowed to be eroded, over the years, through never ending and totally unsuccessful restructuring processes.

Most of the affected depositors are now aged. Their hard work, during their young age only produced the much valued savings, that were to uphold them and their families in the later years. Forcibly holding back such dues from them for almost 8 years, has become the democratic trend of the authorities. Can the regulatory body - the Central Bank, ignore the begging appeals of these depositors? Haramanis from Kotte (An affected depositor) Via email