-PTL Counsel announces his withdrawal of appearance after Palisena’s cross examination
-Aloysius’ inside information ultimately incorrect: Mahendran’s Lawyer
-DSG Gunathilake says Aloysius’ information led PTL to success in bids at the March 29 auction
By Shehan Chamika Silva
Cross examining PTL CEO Kasun Palisena on its calculations on capital gains, Deputy Solicitor General Milinda Gunathilake today said that most of the entries reflected as their costs in the PTL’s documents of secondary market transactions, are merely book entries because such money movement could not see in the CBSL recording systems.
The PTL had earlier provided a set of documents arguing the calculation made earlier by Additional Director (IT) of Central Bank, K.V.K Alwis, over the capital gains of PTL.
Presenting a sample of expenses reflected in the PTL documents, DSG Gunathilake was of the view that some of the money movement had not reflected in the documents at the settlement process in bond transactions. These samples of transactions were between PTL and Perpetual Capital Holding (PCH)- and PTL and WM Mendis & Companies Ltd.
After a series of questions by Commissioners and the DSG, Palisena explained that those PTL purchases from PCH and WM Mendis & Companies may not have reflected in the CBSL recording systems if parties had involved in ‘netting off’ transactions which conduct within parties reflecting only their books of entries.
Cross examination will continue tomorrow.
In the beginning of yesterday’s proceedings, President’s Counsel Nihal Fernando who was appearing on behalf of PTL said that he will withdraw his appearance after the conclusion of Kasun Palisena’s cross -examination.
He said he had already informed his client that he would move out, but his client had requested him to provide substantial time to find another counsel to appear on behalf of PTL. Therefore, considering the professional ethics, Mr. Fernando was of the view that he will continue to represent PTL only until Kasun Palisena’s Cross-examination ends.
The Commission also observed that they have no issue with the professional conduct of Mr. Fernando.
Thereafter, Chanaka de Silva who appeared for Arjun Mahendran cross –examined the witness, Nuwan Salgado, Chief Dealer of PTL regarding the three phone conversations played on September 6, 2017 before the Commission, in which Aloysius seemed instructing his CEO Palisena as how to bid at March 29, 2016 auction having apparently obtained inside information.
However, Mr. de Silva yesterday presenting several official documents relating to March 29 Auction moved that all the information passed by Aloysius to his CEO in that conversations were ultimately incorrect.
Mr. de Silva said that the information relating to interest rate hike, EPF’s and NSB’s bidding pattern and rates at which state banks would bid were all incorrect ultimately.
Pointing on to the so-called meeting held on March 28, 2016 by state banks, Mr. de Silva observed that state banks were also Primary Dealers and holding such meeting to decide on rates is regarded in the market as colluding.
This was the meeting that Aloysius referred in the conversation to Palisena that he received inside information.
Explaining about the third conversation which reflected ‘Rosy’s Son’, Mr. de Silva said according to the backup recordings details the conversation took place on August 12, 2016 and at that time Mahendran was no longer the Governor of CBSL.
He said at that time Handunnetti’s COPE was in operation and his client Mahendran had not gone to it after July, 2017.
According to Mr. de Silva, on the very same day (August 12, 2016 the conversation happened), current Governor, Indrajith Kumarasswami had gone to the COPE.
In the phone conversation, earlier it was transpired that Palisena asks his Chief Dealer Nuwan Salgado to obtain copies of statements that he provided to the COPE from Aloysius. And Salgado testified that Palisena wanted those statements to be sent to the Governor and he understood that it was Arjun Mahendran.
After the Conclusion of Cross-examination of Nuwan Salgado, Deputy Solicitor General Gunathilake also highlighting the percentages of the accepted bids in March 29 auction said, that out of the bids that were accepted at the lowest prices at the auction (Rs. 11 billion), 10 Billion was belonging to PTL.
The ASG said therefore the information seemed to have received to Aloysius, according to the phone conversations are not bad advises, because PTL’s success in bids at the auction is much higher than other Primary Dealers.
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