Who authorized the sale of 1,600,000 shares of CFIN by SLIC to a buyer at Rs800/-

This is the scandalous question no one dare ask. Ironically to make such a blatant transaction without an investigation and report is just as reprehensible. The transaction was of such a significant nature that approval has to be from the top, that is the Chairman. The SLIC (Sri Lanka Insurance Corporation) is a wholly government owned entity and therefore any irregularity must be reported and investigated by the state itself. The very fact that it was not means that there is state patronage for a fraud of such proportions.

I don't know who the Chairman of SLIC was when the transactions were entered into, but clearly the buck stops there and there is no way a sane individual would enter into such a transaction. If Mr Harry Jayawardene was still at the helm of SLIC he would not have sold those shares for any less than Rs1500 each, the price it is currently trading at. It rose to Rs1800 a few weeks ago, but for such a large block Rs1500 to me seems a reasonable price.

The shares in smaller blocks that were trading at around Rs900 when this transaction was announced, shot up to Rs1200 as soon as it was announced. If we are talking kickbacks as that would be the only way one would have been persuaded to part with the shares at that price, my guess of he value of the kickback to the buyer is Rs100 each. that means the bribe paid amounts to Rs160M not small change. It seems that Sri Lankans will sacrifice their mother for that kind of money.

It is highly likely that these shares will sold on again within a short while to the EPF at about Rs1700 each giving the buyer a net profit of around Rs1.5Billion in a matter of a few months.If EPF is persuaded to purchase these shares at this price, then the persuader will also receive a minimum Rs160M bribe, but I suspect it could be as high as Rs320M. We are talking serious money here. No one can make serious money today without the back of the powers.

My simple point is that EPF should have bought these severely undervalued shares at Rs800 and end it at that, as it is from one govt. owned institution to another govt. managed one. At least all the capital gains accrue to the govt. Here the EPF will pay 1700 and the shares will rise above that for a short time so that they can justify making this purchase, however once the market tanks these shares will come down to Rs800. In the latter suggestion the EPF will not have a huge loss, and instead be known to have broken even. Now the EPF stakeholders the people of the country stand to lose Rs1.5B, a clever way of transferring money from the state to a few govt. favored individuals, if it is not members of the first family, who do not let a good thing come by.