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2022 fuel/crude imports: CIABOC to probe Rs. 30 b ‘frauds’

2022 fuel/crude imports: CIABOC to probe Rs. 30 b ‘frauds’

06 Feb 2024 | BY Buddhika Samaraweera


The Commission to Investigate Allegations of Bribery or Corruption (CIABOC) is to investigate alleged financial irregularities of nearly Rs. 30 billion (b) in the importation of fuel and crude oil for the Ceylon Petroleum Corporation (CPC) in the year 2022, The Daily Morning learns.

Late last year, the Electricity Consumers’ Association (ECA) had written to several parties including the CIABOC and the Criminal Investigations Department (CID), seeking an investigation into the alleged financial irregularities amounting to about Rs. 30 billion in the importation of fuel and crude oil for the CPC in 2022, and action against responsible individuals.

In response to their complaint, the CIABOC had informed the ECA that it, after studying the relevant complaint, had decided to carry out a preliminary investigation into the matter. The CIABOC informed ECA General Secretary Sanjeewa Dhammika regarding the matter in writing, through a letter dated 19 January 2024.

On an earlier occasion, Dhammika claimed that the CPC had signed a long-term agreement to purchase diesel between 1 March and 31 October 2022, and that under that agreement, the relevant company had agreed to supply diesel at $ 6.98 per barrel. Despite the said agreement, he alleged that the CPC had paid $ 24 per barrel when purchasing 995,992 barrels of diesel from the relevant company, and that thus, a financial irregularity of Rs. 3.04 billion had occurred. 

Furthermore, while having a contract with the said company to supply a barrel of diesel at $ 6.98, he claimed that the CPC had purchased 922,381 barrels of diesel during the relevant period at the high prices of $ 13.83, $ 17, and $ 19.87 from another two companies, and that an irregularity of Rs. 3.38 billion has been caused through it. 

Dhammika also charged that there had been frauds relating to the sale of low-quality fuel by substituting high-quality fuel during the course of 2022. While 1,820,012 barrels of auto diesel had been imported in the year 2022, he claimed that their price had been set based on high-quality fuel prices instead of the actual cost, and that through it, a financial fraud of Rs. 3.87 billion had taken place. 

In addition, he alleged that 599,722 barrels of low-quality diesel had been imported under the credit facility provided by the Government of India for the purchase of essential commodities, and that a fraud of Rs. 1.67 billion had taken place due to the fixing of the price of that diesel on the basis of the prices paid for high-quality fuel. He further claimed that 2,023,509 barrels of inferior crude oil had been imported from Siberia on three other occasions in 2022, and that a fraud of Rs. 17.87 billion had been committed in the related transactions.

The ECA had also written to Acting Inspector General of Police Deshabandu Tennakoon, the CIABOC, the National Audit Office, the Central Bank of Sri Lanka, the Public Utilities Commission, the Consumer Affairs Authority, the Committee on Public Enterprises, Speaker of Parliament Mahinda Yapa Abeywardana, Samagi Jana Balawegaya and Opposition Leader Sajith Premadasa, and all other political party leaders to intervene to initiate an immediate investigation into the alleged frauds, and to take steps to recover the losses from relevant officials.




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