Chief Inspector of Police Varuni Bogahawatta and three other suspects were remanded until Friday (6) by the Matara Magistrate’s Court in connection with a money laundering investigation.

The four were produced before Matara Magistrate Chathura Dissanayake on Tuesday (3) by the Police Financial and Commercial Crimes Investigation Division, which arrested them. Ms Bogahawatta was formerly in charge of the administration branch at the Kotawila Police Station.

Investigators told the court that the chief inspector’s monthly salary is about Rs. 140,000, while the monthly lease instalment on the Honda Vezel she used is Rs. 132,000. The red car is valued at close to Rs. 15 million, the court was told.

The investigators said inquiries are under way into the sources of the money used to buy the vehicle and to pay its lease instalments. The car, registration number CBE 1874, was taken into police custody on October 16.

Reports also say the investigation has indicated that a person linked to a large-scale financial fraud allegedly involving the Matara District Rural Bank Union and the Matara Multi-Purpose Co-operative Society paid the lease instalments. This has not been proved in court.

Several other vehicles have also been taken into police custody during the investigation, according to reports.

After considering the facts presented, the Magistrate ordered that the suspects be held in remand custody until Friday and told the investigators to report on the progress of the inquiry to the court on that date.

Investigations into the allegations are continuing. The allegations have not been proved before any court.

Background

The fraud allegations connected to the two Matara co-operative institutions involve their former chairman, Chaminda Gunasekara. He faces allegations of financial fraud running into hundreds of crores of rupees, and was arrested by the Criminal Investigation Department on April 10.

Money laundering is an offence under Sri Lanka’s Prevention of Money Laundering Act. In such inquiries, investigators generally try to establish where the money used to acquire an asset came from, which is why the source of the funds for the car and its lease payments is central to this case.

Remand does not amount to a finding of guilt. It means the suspects are held in custody while the police continue their investigation and report to court.

What it means

The case is being watched closely because the investigation touches both a serving senior police officer and a financial fraud case that has affected members of co-operative institutions in the Matara district. Members and depositors of such institutions are generally advised to follow official announcements and court proceedings for developments that may affect them.

Investigators are due to report on the progress of the inquiry to the court on Friday (6).