Bond dealers ‘scam’ duo kept in custody

HELD: Arjun
Aloysius (second
left) is escorted
to a prison bus
HELD: Arjun Aloysius (second left) is escorted to a prison bus

A COURT in Sri Lanka on Monday (5) ordered two executives from dealer Perpetual Treasuries Ltd, arrested over an alleged govern­ment bond scam, to remain in custody until February 16.  

Police arrested Perpetual’s owner Arjun Aloysius and CEO Kasun Palisena last Sunday (4) on suspicion of involvement in the alleged scam.  

Perpetual bought more than half the debt on sale in a govern­ment bond auction in 2015 and a presidential inquiry reported last month that Perpetual Treasuries had profited through illegal means.  

Aloysius, Palisena and Perpet­ual Treasuries have all denied any wrongdoing.  

Aloysius is the son-in-law of Arjuna Mahendran, who was cen­tral bank governor at the time of the auction.  

Kalinga Indratissa, the attor­ney for both Aloysius and Palise­na, said the court had ordered that they stay in custody until February 16 after police filed charges on misappropriation of property, criminal breach of trust, offences under the public proper­ty act and the registered stockbro­kers ordinance.  

The arrests came after presi­dent Maithripala Sirisena said last month that a presidential commission investigating the 2015 bond sales had recom­mended legal action against the finance minister and central bank governor at the time, as well as the owner and officials of Per­petual Treasuries.  

Mahendran and Ravi Karuna­nayakehas, who was finance min­ister at the time, have also denied any wrongdoing.