Large-scale corruption cannot happen without professional complicity

Auditor General, W.A. Wijewardena, Chandra Jayaratne and corrupt auditors

By Amrit Muttukumaru, MA Econ. (Madras); MBM (Asian Inst. of Mgmt.)

Large-scale corruption initiated by politicians and corporate bigwigs cannot happen without professional complicity. Hence, how could anyone be sincere in combating corruption when they ignore professional complicity and focus on the role of politicians while being tardy on the involvement of corporate bigwigs?

For example, could the alleged terrible corruption under the Rajapaksa administration have taken place if the professionals particularly in the Treasury, Ministry of Finance, Central Bank and Securities and Exchange Commission stood their ground?

Is not the silence of Auditor-General (Gamini Wijesinghe), W.A Wijewardena and Chandra Jayaratne on my ‘Daily FT’ article ‘Auditor General silent on corrupt CA Sri Lanka’ symptomatic of this malaise given the fact these gentlemen hardly utter a word on professional and corporate culpability while making a hue and cry with media backing on the evils of corruption?

(http://www.ft.lk/article/600419/Auditor-General-silent-on-corrupt-CA-Sri-Lanka)
Cartoon googled and added by TW
Image result for professional frauds cartoons

Where is the promised accountability for the alleged ‘pump and dump’ of shares in the Colombo bourse by a supposed ‘stock market mafia’? Has there been any notable improvement in SriLankan Airlines despite a ’changing of the guard’? Are not many of the staggeringly wealthy corporate personalities in this country a creation of state patronage under successive administrations with professional complicity? What implications has this for the country when the private sector is assigned the role of ‘engine of growth’? Are these of no interest to activists?

My said article was inter alia written in the context of:

1) Chartered accountants and auditors are the first line of defence against corruption in all entities dealing with financial resources.

2) The miserable failure of CA Sri Lanka (Institute of Chartered Accountants of Sri Lanka) and SLAASMB (Sri Lanka Accounting and Auditing Standards Monitoring Board) to hold the ‘Partners’ concerned of the two largest audit firms in the country – PwC & EY accountable for the ‘open and shut’ case of professional misconduct in the fraudulent privatisation of SLIC (Sri Lanka Insurance Corporation) confirmed by (i) Supreme Court (ii) Parliament’s COPE (iii) Attorney-General and even CA Sri Lanka ‘Ethics’ Committee itself.

3) The Auditor-General is an Ex-Officio member of the powerful ‘Council’ of CA Sri Lanka. The incumbent (Gamini Wijesinghe) is also a Senior Chartered Accountant.

4) Previously he was Director-General, SLAASMB.

5) The alleged Treasury bond scams could not have taken place without the complicity of professionals in the hierarchy of the Central Bank and Bank of Ceylon – accountants, lawyers and others. Why is this being overlooked?

6) The alleged egregious corruption and abuse of power in Sri Lankan Airlines with banner headlines glaringly omitting to identity its longstanding auditor – Ernst & Young. This is avoided by all purported ‘good governance’ activists! Why?

7) The Auditor-General will enhance his credibility and moral authority if he uses his membership in the CA Sri Lanka ‘Council’ to demand accountability for the ‘open and shut’ case of professional misconduct in the fraudulent SLIC privatisation.

8) Prominent ‘Daily FT’ columnist on ‘good governance’ W.A. Wijewardena – former Deputy Governor, Central Bank of Sri Lanka was longstanding Chairman, SLAASMB. At the conclusion of its purported ‘investigation’ of the fraudulent SLIC privatisation, I received the following FARCICAL response as per its e-mail dated 28 November 2005 (he was Chairman on this date):

“Whilst we appreciate the contribution made by the complainants, we are not in a position to keep the complainant informed of the progress of the investigation and the outcome of the investigation, as it would undermine our policy on releasing information to the public.” (http://srilankaeconomicforum.org/weerakoon-wijewardena.html)

9) Prominent media coverage given mainly in the ‘Daily FT’ to the ‘Open Letters’ of Chandra Jayaratne held out to be a “good governance activist”.

Conclusion

The ‘open and shut’ case of professional misconduct in the fraudulent SLIC privatisation is an acid test for ‘good governance’ activists – particularly Auditor General Gamini Wijesinghe. Much is expected of him. He is described by an influential section of the media as “fearless” and a “knight in shining armour”. There is even a Supreme Court judgment also signed by recently retired Chief Justice K. Sripavan.

In the context of the ‘Partnership’ Law in Sri Lanka where all ‘Partners’ are ‘jointly and severally’ liable for any wrongdoing will Gamini Wijesinghe, W.A Wijewardena and Chandra Jayaratne:

1) Insist that CA Sri Lanka will forthwith disclose the identity of those who were ‘Partners’ of PwC and EY at least three years prior to 11 April 2003 which is the date on which the fraudulent SLIC privatisation took place?

2) Impress on CA Sri Lanka that not holding the ‘Partners’ concerned accountable violates with impunity Section 17 (2) (b) of CA Sri Lanka Act of Incorporation which clearly stipulates that when an ‘Investigating Committee’ appointed by the ‘Council’ – “reports to the Council that a prima facie case of professional misconduct has been made out against a member, the Council SHALL appoint a disciplinary committee for the purpose of inquiring into the conduct of such member”?

Will they bite the bullet?

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