ARE GKCC DEPOSITORS VICTIMS OF INDIFFERENT GOVERNANCE?
by I. S. Senguttuvan
of cosmetic action - a meeting or two with the President and letters flowing either way. But most of these once-middle class men, women and children have no one in the State now to offer them the help and the relief that should have been their due many moons ago. Except for a payment of Rs.100,000 a few months ago, these depositors have been living in falose hopes since December 2008 when the Kotelawala scam empire came crashing down. With the intervention of some humane judges of the Supreme Court another Rs.200,000 was ordered to be paid in August 2010 but all sorts of ifs and buts came in between and the payment has been in suspense since. So much for the directives of our highest judicial entity being carried out.
Hopes of depositors rose when they met President Rajpakse and Governor of the Central Bank of Ceylon in the course of last year but this waned when their fate was placed in the hands of a Committee of high-powered Chartered Accountants. The passage of time showed these men have helped themselves more than the poor whom they were expected to save. The performance of the trio of Chartered Accountants is akin to the local tale of being promised the elephant and eventually ending up producing a mouse. On a depositor public that has virtually lost its faith in most private enterprise the imposition of the Special Purpose Vehicle converting their holdings to shares is no more than a device for the government as a face-saving exit strategy. While depositors are pleading for the return of their funds through the interest of which they ran their homes on a monthly basis, they are now told what they will get are the dividends from the “profits” of this new vehicle. That it will take several years down this road to materialize results defeats the hopes of the depositors. This does not appear to bother anyone in the power structure complain these depositors. With every passing week depositors suspect all the juicier assets of Kotelawala are vanishing behind their backs. The wolves that feed on dead carcass are waiting, once again, to make a fast buck on the miseries of thousands of grievously injured families.
Death by suicide of Mark Madoff, son of the main culprit Bernard, last December in his plush New York apartment brought to fore again to the public eye this mega-scam - that gulped over US$65 billion mostly from super rich investors from the cream of Who’s Who of American society – Film-maker billionaire Steven Spielberg, Film-star Kevin Bacon, Zsa Zsa Gabor, Jeff Kaltenbach being just a few of those who implicitly trusted the Maddoffs. Signalling that it is a more cultured society out there, some of the investors made available huge sums to pay “the smaller depositors who relied on the income from their Madoff investments to feed their home fires” Philanthrophist Jeffrey Powers returned US$7.2 billion – yes, billion - so that the smaller segment of the depositors can be saved. The Powers family are as big givers to charity and education as their wealth. Among their beneficiaries are the Harvard University and MITI. After the death of Jeffrey Powers Mrs. Powers was to tell the media their dues to the Maddoff outfit was less than US$2 billion in a relationship going into several years. Another financier Carl Shapiro of Boston chipped in with US$625 with the comment “I know the pain of losing” Phyllis Molchatsky (66) who lost her comfortable apartment in a fashionable Manhattan neighborhood now does 5 jobs – washerwoman, cook, salesperson, guide and chauffeur – just to earn enough “to eat and live” She lost her entire life’s savings of under US$2 million to Madoff. Fortunately, civil society, the media and The System in the US did not remain careless or deaf and dumb. The plight of the smaller depositors also caught the eye of the judiciary. US District Court Judge Victor Maureno wove through a minefield of lawfully crafted defences from top lawyers representing rich clients and left open the possibility of punitive damages in the future. Judge Maureno kept the cases open so that the smaller despositors, in particular, do not go down. Irving Picard - appointed by the Justice Department as Trustee of the Maddoff funds – has indicated where his sympathies lay when he speaks regularly to the media. Many of the smaller depositors there are certain of substantial paybacks.
In an environment where State actors hardly seem to show either sympathy or duty to the GKCCC depositors, it is hoped the judiciary will. It is encouraging some seniors in our own higher judicial system have seen the suffering that has been the misfortune of nearly 8,000 families. Former Indian Chief Justice Bhagwathi showed the goodness in this part of the world judicial activism can cause to the poorer sections of society unable to retain the right legal representation to secure its rights. Bhagwathi was convinced the integrity of the Justice system needs to be seen as something synonymous with the good of the poor as well is to engage popular acceptance. The relief he brought to society in general the poor against vested interests against the Real Estate Mafia through his work on Public Litigation Law not merely endears him to millions of handicapped Indian litigants but also restores the confidence of the people in the judicial system. In spite of his alleged faults, former Chief Justice Sarath Silva proved in several instances excessively conforming judges and a virtual non-caring legal system can be left behind with activism in the wider interests of the people in the country. He was to comment “Public interest should be at the root of the minds of judges”
How and when will these helpless depositors regain their assets is the question in the minds of a large number of people whose future and lives hinge on the action of the Rajapakse government.
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