Sri Lanka Express

FCID lied about clause in controversial Los Angeles Consulate lease agreement?

 By Hassina Leelarathna
August 13, 2017

Did Financial Crimes Investigation Division (FCID) officials investigating alleged misappropriation of funds in the leasing of a residence for the Los Angeles consul general lie to the Fort Magistrate about the terms of the lease at a hearing held July 31?

As reported by the state-run Daily News ( “Rs. 40 million paid for non-existent Consul General.”  8/1/17) , in submissions before Magistrate Ms. Lanka Jayarathne, the FCID  had informed the court that “a sum of Rupees 40 million had been misappropriated in the guise of paying for rent for the Consul General office in Los Angeles.”
“It was also revealed that the payments had been made in violation of the lease agreement which said that in the event of non -appointment of a Consul General, the agreement would be terminated.”

If the FCID officers did tell the magistrate that payments were made in “violation” of the lease agreement,” it would be a lie since that document does not have such a clause.     

What is the Daily News story missing?

The agreement stipulated, as is standard practice, a monthly payment of $8,300 for the full term of   24 months (March 1, 2013 – February 28, 2015).  The clause on early termination states: "[In] the event of termination by Tenant prior to completion of the original term of the Agreement, Tenant shall also be responsible for lost Rent, rental commissions, advertising expenses and painting costs necessary to ready Premises for re-rental.”

The crux of the allegations, based upon statements made in parliament by former foreign minister Mangala Samaraweera, is that a house was leased in Los Angeles for the consul general while that position was vacant (August 2013 – February 2015).   The house was instead occupied by two military officers, who were a part of ex- Defense Secretary Gotabhaya Rajapaksa’s detail. Mr. Samaraweera also alleged that the defense secretary’s adult son had lived at the residence during that period, a charge Mr. Rajapaksa has denied.
The lease was signed by the former Consul General Hector Weerasinghe  in February 2013.  Why he entered into a 2-year lease when his tenure as CG was coming to an end in July of that year is unclear.   Was the monthly rental lower with a 2-year vs. 1-year plan, or was he hoping for an extension so he could continue to enjoy his retirement in Los Angeles? 

Also in question is why Mr. Malraj de Silva who was appointed to succeed Dr. Weerasinghe as CG on September 9, 2013, failed to inform the foreign ministry that he was not accepting the position, all the while presenting himself at public events as the “consul general designate.”  
   Dr. Weerasinghe
The consulate was required to provide housing for the two military officers who were employed as its drivers, a point noted by the SL government auditors who were in Los Angeles in 2016 to investigate the consulate’s accounts, including the lease in question.  It must be noted that while there was no consul general, the LA consulate remained open for business, with some oversight by the embassy in Washington.  

Whichever way you look at it, the consulate was on the hook for the full 24-months’ rental payment and there was no way around that legal obligation.  

Had the residence not been occupied, GOSL would have risked even further liability from squatters taking over the premises, or vandals destroying it. 

If payments were made in “violation of the lease agreement,” it was by the new government, when the foreign ministry came under Mr. Samaraweera in January 2015.  Repeated requests by the consulate staff for directions on whether to renew or cancel the lease which was expiring on February 28, 2015 went unanswered.  Eventually, the lease was extended till June 30, 2015 -- an additional 4 months for the “non-existent” consul general, an additional $33,200 (estimated Rs.4.7 million) “misappropriated.” 

The evidence presented to the magistrate’s court was the FCID’s first public statement on this case after the visit in February this year of two senior police officers to Los Angeles.  As we reported at the time, the visiting FCID officers tried intimidation and harassment in their desperation to get a consulate employee to sign a statement saying the younger Rajapaksa had lived at the residence.  

Despite strongarm tactics, the two police officers’ 10,000-mile trip to the US, at least $25,000 in airfares and other travel expenses, and the interrogation of 24 witnesses the holy grail in this case is still to be found.

With an apparent blanket mandate to throw good money after bad, as long as the quarry is a Rajapaksa, the FCID is in no hurry to give up.   As reported by the Daily News, the proceedings at the Fort Magistrate’s court was wrapped up with the following exchange:      

“The FCID also informed court that further investigations are being carried out to ascertain if any other persons had resided at the premises.
The Court informed the FCID to continue with the investigations and report to court regarding its findings.”

Where will the FCID be flying to next?