MiG fraud: FCID finds startling new details
A near three-year investigation by the Financial Crimes Investigation Division (FCID) into the procurement of MiG-27 fighter jets for the Sri Lanka Air Force (SLAF) has bared some startling details. Firstly, what was touted as a “Government-to-Government” Agreement between Ukrinmarsh, a military goods export firm in Ukraine, and the Commander of the Sri Lanka Air Force (SLAF), has turned out to be a fraudulent document.
The FCID has said that the Ukranian Prosecutor General has confirmed that there has been a financial misappropriation in the deal. Funds from the SLAF have gone to Bellimissa Holdings Limited. This company, as periodically revealed by the Sunday Times, only had an office address, with a chair and a table, in London. From there, the funds have been remitted to a secret account in the British Virgin Islands where the company had been incorporated.
In reality, the agreement with Ukrinmarsh has been with the Singapore based D.S. Alliance, which had supplied MiG-27 fighter jets to the SLAF earlier too. D.S. Alliance Managing Director Lee Than Soo (T.S. Lee) has been the main player in Bellimissa Holdings Ltd.
FCID investigations have revealed that Dmitry Alexandrovich Perugudov, then a Director of Ukrinmarsh, had signed on behalf of Ukrinmarsh. He had fled Ukraine thereafter. The Ukrainian authorities tracked him down at a Paris address and arrested him.
Highlights of the FCID findings
Multimillion dollar MiG deal: Focus on fake contract but real story emerges now. FCID launches all-out search for Weeratunga, obtains court orders on his properties and accounts
On a bitterly chilly wintry morning in the Ukranian capital of Kiev last year, an investigation team from the Financial Crimes Investigation Division (FCID) sat down to a conference with officials. Present were the country’s Prosecutor General and top officials of Ukrinmarsh, the state agency that exports military products and related equipment.
The FCID team leader, Senior DIG Ravi Waidyalankara, who is the head of the FCID, asked a senior official of Ukrinmarsh about the sale to Sri Lanka of MiG 27 fighter jets and a trainer to the Sri Lanka Air Force. “What sale?” he asked and exhorted “there has been no sale of any MiG-27 aircraft to Sri Lanka from us. There never was.”
How then did claims arise that there has been a “Government-to-Government” deal to procure these MiG-27s in 2006? In fact, a voluminous document said, “CONTRACT BETWEEN THE SRI LANKA AIR FORCE FOR AND ON BEHALF OF THE GOVERNMENT OF THE DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA AND M/S STATE SELF-SUPPORTING FOREIGN TRADE AND INVESTMENT FIRM ‘UKRINMARSH’ (SUBSIDIARY OF ‘UKRSPECTSEXPORT”) UKRAINE”
The answer – the so called contract of July 26, 2006 is fictitious and was not the real one. So is the reference in the fake contract to a Designated Party – Bellimissa Holdings Ltd., 2nd Floor, 145-157 St. John Street, London. This was just an office with a desk and a table and fund remittances ended up in a secret bank account in British Virgin Islands (BIV).
These are the startling findings made during a near three-year long investigation into the reported procurement by the Sri Lanka Air Force (SLAF) of four MiG-27 aircraft (costing US$ 9.848 million), overhauling three more MiG-27s and one 23 UB trainer (costing US$ 4.128 million) plus a transport cost of US$ 700,000.
The fake agreement listed the Commander of the Air Force as the buyer and the seller as Ukrinmarsh. Not only did Ukrinmarsh deny selling any MiG 27s to the SLAF at anytime, but the FCID investigations have now revealed that they did so to Bellimissa Holdings Ltd. which ran from a dead letter address in London. Confirming this fact was official documentation forwarded by BVI Financial Investigation Agency’s Dirk Walters regarding Bellimissa Holdings (Pvt.) Ltd. Their report to the FCID has also been authenticated by BVI Attorney General Department’s, Sarah Potter-Washington. Bellimissa Holdings have been registered at the Offshore Incorporation Centre, Tortola, British Virgin Islands.
The Directors of this company are named as Lee Thian Soo (Singapore National Registration Identity Card No 1180208 G) and NG Lay Kim Soo (NRIC No 1426375). The company secretary has been named as Lymkim Lark (NRIC No 80079880 F).
On May 23, 2006 the two directors have moved amendments to the Memorandum of the Company to include sale and repairs of military and security equipment, explosives, firearms, ammunition, aircraft, warships and electronic equipment. Who are these Singaporean nationals involved in the MiG-27 deal? Lee Thian Soo has been the Managing Director of D.S. Alliance, Singapore – the company which had previously supplied MiG-27s under a contract with the SLAF.
The FCID has found that the Ukrainian authorities had signed two different agreements with D.S. Alliance (through Bellimissa Holdings) to which the Sri Lanka Air Force has made payments. Bellimissa Holdings had in fact been a front company of D.S. Alliance. An FCID report said, “it has been observed that the Director of Ukrinmarsh Dmitry Alexandrovich Perugodov, Sri Lanka’s Former Ambassador to Russia Udayanga Weeratunga, the Singaporean company D.S. Alliance Pvt Lte Managing Director Lee Thian Soo (T.S. Lee), Bellimissa Holdings Ltd. representative Kykola Kuldyrkaive and Sri Lanka Air Force officers have been involved in the financial misappropriation and conspiracy and aiding and abetting in misappropriation.”
Investigations have revealed that “a total payment of US$ 15,665,437.24 has been paid by the Sri Lanka Air Force under agreement SLAF/2006/07/AIR to Bellimissa Holdings Ltd. The agreements between D.S. Alliance Pvt Lte and Ukrinmarsh (certified copies of which have been obtained by the FCID), has been for US$ 7,833,000. Accordingly, FCID investigations have revealed that Udayanga Weeratunga, together with the others who have been identified by them, have caused a loss to the Sri Lanka Government amounting to US$ 6,831,344.24 due to financial misappropriation.
On Friday, the Fort Magistrate Lanka Jayaratne issued an open warrant for the arrest of Udayanga Weeratunga. Whilst trying to travel from Dubai to the United States of America, using Sri Lankan Passport No D 3643585 which has been blacklisted by the Controller of Immigration, he was detained at the Dubai Airport. The passport was taken into custody. Details of this passport were revealed exclusively in the Sunday Times (political commentary) of May 8, 2017
At that time, only an Interpol ‘blue notice’ had been issued. He had been released on the grounds that he presents himself when required. His fingerprints, address and telephone numbers had been obtained and the passport confiscated. In the meantime on February 12, Weeratunga had been asked to report to the Criminal Investigation Department in Dubai. He had not done so. His phone number had been disconnected and no one had been present at the address given.
D.A. Perugudov, who signed the agreement on behalf of Ukrinmarsh had later disappeared from Ukraine. After a worldwide search, Ukranian authorities located him at an address in Paris. He has since been arrested by the Ukranian authorities. The FCID has obtained a string of court orders to prevent Weeratunga from selling or transferring of property in the Gampaha District, an apartment complex in Colombo and is awaiting details of a remittance of over Rs 20 million to a local bank account. Among the countries in which searches for his foreign bank accounts are now under way are the United States, Hong Kong, Singapore and Latvia.
The ‘original’ fake agreement (SLAF/2006/07/Air) has gone missing from Air Force Headquarters. The FCID has already fixed responsibility on an officer who has been identified. The FCID is now in consultation with the Attorney General’s Department on the action that has to be taken with regard to this particular officer. The FCID has, however, obtained another certified copy of the same fictitious agreement which has been filed in court as a production.
It was the Sunday Times that exclusively revealed the MiG-27 deal during a series of exposures starting in 2006.