The Rs. 2,785 million deposited in the Dehshodaya Development Financial Company, which is not a registered financial institution at the Central Bank of Sri Lanka, by 1.5 million depositors is now at risk, sources from Sarvodaya said.
The financial company is managed by the Sarvodaya Shramadana unit. Monies of Sarvodaya Economic Enterprise Development Services Company (SEEDS) and the loans taken from the company and all its revenue is with this financial institution.
Head of Sarvodaya, A.T. Ariyaratne has on April 26, 2011 stated in writing to the depositors that the Deshodaya Development Finance Company Limited has been established as a financial company with Central Bank approval.
However, the Central Bank states that a company called Deshodaya has not been registered with it. The Sarvodaya financial company has introduced eight savings accounts. The compulsory savings account, normal savings account, children’s savings account, Jayen Jaya, Sahsra Wasana, Avurudhu Wasana, Singithi Rekavarana, short and mid term fixed deposits are included among the savings accounts.
Nevertheless neither Sarvodaya nor Deshodaya Development Finance Company has not been listed among the 24 licensed commercial banks, nine specialized banks and 43 financial companies under the Central Bank.
Sarvodaya had carried out this unlicensed financial company using the powers of President’s Mahinda Rajapaksa’s brother in-law, Dr. Lalith Chandradasa. However, Lalith Chandradasa had resigned from Sarvodaya three months earlier and assumed duties as a senior Presidential advisor.
The Central Bank of Sri Lanka has previously asked the people not to carry out any transaction with unlicensed financial institutions.