The Sri Lankan government on Saturday announced a criminal investigation into the US$2.3 billion purchase of 10 Airbus aircraft for the island’s loss-making national carrier under the former administration.
Sri Lankan Prime Minister Ranil Wickremesinghe’s office said a panel found gross violations of financial regulations and procurement procedures in the state-owned Sri Lankan Airlines deal, and said they warranted criminal prosecutions of former executives.
The independent panel handed a dossier to Wickremesinghe on Thursday and officials, speaking anonymously, said the government accepted its recommendations.
“The board of inquiry has found shocking details of corruption running into billions of dollars, manipulations of service contracting, recruitment of unqualified staff and major security breaches at Sri Lankan Airlines under the former government,” the prime minister’s office said in a statement.
It said the panel, headed by a former chairman of Transparency International’s Sri Lanka office, found a “culture of corruption” in the airline, which has accumulated losses of more than US$650 million.
The board of inquiry recommended “criminal investigations into the entire refleeting process.”
In particular, it said there was sufficient evidence to prosecute the former airline chairman Nishantha Wickramasinghe — brother-in-law of former Sri Lankan president Mahinda Rajapaksa — as well as former chief executive Kapila Chandrasena, who resigned last month when the panel called for action against him in an interim report.
“The former government of...Rajapaksa made management changes to carry out a refleeting of the airline with brand-new aircraft costing US$2.3 billion, despite the availability of more cost-effective alternatives,” the statement said.
Sri Lankan Airlines ordered six Airbus A330 aircraft and four A350 airplanes in 2013. It took delivery of the first two A330 planes last year.
The carrier has said it expects three A350 aircraft to be delivered next year and the fourth in 2017.
The statement from the prime minister’s office said the probe also found that the national carrier had tried to “hush up” serious mistakes by pilots, but gave no details.
Allegedly, the carrier also tried to reduce entry qualifications for cadet pilots, but the changes were averted, because two instructors quit rather than agree to lowering professional standards.
However, several cabin crew were recruited on verbal requests from senior management, despite having failed preliminary tests and interviews, the statement said.
Soon after the new government came to power, Sri Lankan Airlines stopped flying to the island’s second international airport, dismissed by critics as a white elephant Rajapaksa built and named after himself.
The January election was fought partly on claims of corruption and waste by the Rajapaksa administration, which is facing allegations of padding infrastructure projects to siphon off money.
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