Minister bares money racket by 'co-operative banks'

Irangika Range

COLOMBO: Trade, Marketing Development, Co-operatives and Consumer Services Minister Bandula Gunawardena has brought to the notice of the Parliamentary Consultative Committee on Finance about a major money racket committed by certain banks which call themselves 'co-operative banks'.

Gunawardena told the Daily News yesterday that the Ministry has received information about two such 'co-operative banks' in the Central Province. "We believe these fraudulent banks are operating countrywide abusing the 'co-operative' and 'bank' names," the Minister said. Gunawardena said these 'fraudulent co-operative banks' are engaged in illegal activities by appearing as registered organisations.

The Minister said he brought this to the notice of the Parliamentary Consultative Committee on Finance last week.

The Minister said the issue will also be brought to the Central Bank's notice for investigation and follow up action. His Ministry has been receiving many public complaints regarding the illegal Co-operative banks engaged in accepting deposits from the people providing leasing facilities and pawning on higher interest rates appearing as registered Co-operative banks. "These are illegal organisations which are not registered under the Central Bank or the

Co-operative Development Department," the Minister said. "People should be aware of these illegal institutions and stern legal action will be taken against the culprits," Gunawardena added.

"One suspect has already been taken into custody in this regard after investigations," the Minister added.

"These illegal activities mislead the people as well as tarnishes the name of the Co-operative sector.

The public should be vigilant on these illegal institutions," he said.