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Is your money managed by others really belong to you?

By Sarath Wijesinghe

(March 13, Colombo, Sri Lanka Guardian) World consumer day was first observed on 15th March 1983 in order to promote basic rights of all consumers for demanding that those rights are protected and respected.The identified consumer rights by the United Nations are right to satisfaction of basic needs, right to safety, right to be informed, right to choose, right to be heard, right to redress, right to consumer education, and right for a healthy environment. Do we really enjoy these cherished rights is a moot issue .This is the framework on which the domestic consumer mechanisms in respective countries have been formulated depending on the circumstances and atmosphere of respective jurisdictions. In a free economy consumerism plays a major role in reducing the cost of living and providing the citizen consumer items of quality at an affordable prize. We have embraced free economy in 1978 in place of close economy replacing the concept of price control introduced during war days. In the “West” consumerism is powerful by organizing themselves with the backing of the civil society and the media. Other parts of the world too consumerism is vibrant and powerful except in Sri Lanka still in the primitive stages. Consumer International every year chooses an important topic as a slogan to activate the consumer movement and keep the movement alive. Last year the issue was Junk food generation and this year it is “your money our rights” which is very opportune on the current financial crisis and uncertainty due to the recent unpleasant experiences worldwide on economy and financial crisis that crippled the world economy to a grinding halt. Consumer worldwide is a powerful force well organised with media worldwide. It was celebrated with the leadership of the Consumer Affairs authority the main regulator. This year the mantel and the leadership is on the Public Utilities Commission another regulator acts on behalf and the interest of the Consumer defined in both CAA and PUSL as “any actual or potential user of any goods or services made available for a consideration by any trader or manufacturer.” Charter on fundamental rights jurisdiction and public law remedies available in the system of law has some opening in promoting and enjoying consumer rights which are a basic human right. World consumer day initiatives can be concerned with the food we eat, medicine we take, products we use and most importantly the money we earn the hard way which is being owned and managed by others on our behalf. There should be transparency in dealing/managing and accountability for our hard earned money which is lacking anywhere in the world.

Theme last two years

The theme last two years has been Junk food Generation (please browse net to retrieve the article on Junk food generation on Sunday Leader/ Sunday Observer/ Nation and Websites on 15/3/2009 by typing the topic, writers name and the name of the paper and websites) based on the preparation of unhealthy food especially for the children and the health hazards and spread of diseases. Famous fast food chains and the small and large food chains in food industry have been the culprits against whom the consumerism movement and the civil society waged war for better healthy and quality food at a reasonable price. Yet the health of the generation world wide is day by day deteriorating. This disturbed our traditional food culture that made our Nation powerful and healthy with locally manufactured food and living with “Nature”.

Is your money managed by others really belong to you?

Central Banks, Banks, and financial institutions manage our money for which their accountability to the investor is less or no. The world financial crisis was due to the fraduland conduct and mismanagement of financial institutions in the USA and UK and the west to which the entire world had to pay a high price. In the West the house market on which the money market was depending collapsed as a result of over inflating the property markets. West is used to “Credit Card” living where spending was based on paperwork of financial institutions. Nation was sued to live on loans and credit cards. This is not safe in the long run. They are a nation of debtors living on debts with no shame or hesitations unlike Asians who are reluctant to live under the roof of a mortgaged property belong to others. We tend to lead a simple life with our own money instead of enjoying comforts on borrowed money. We escaped the crisis because we are traditionalist and careful in dealing with money. Our banks were cautious and strictly adhered to rules. In England bank managers were so corrupt that they went after lenders offering loans for a consideration leading to the collapse of the financial institutions in UK and USA recovering at a very sloe pace. Loans were granted with inflated values and USA and UK fell down together with the EU and other connected jurisdictions. It is taking time to recover. Are the banks and financial institutions are honest or competent to manage our money is a moot issue as they are answerable to the State and the share holders and not those investors which amount to 80% of the value of establishment. No steps are taken to be answerable to the investors and all steps are taken to educate and for the safety of the share holders who are not necessarily the investees. They posses a nominal share and have the lion share of the profit perks and benefits as “fat cats” and violent sharks in the field of financial gold mine. It is time the consumer movement take these challenges in order to take legal and other procedural steps for accountability and proper protection of the investors and for a fair hearing and share the management in line with the powers of the share holders. We have no control and access of our money nor are we informed of the mode of investments to which the share holders have full access legal and otherwise. Once you part with money you have no control and accountability.

“26 Billion Unregulated funds over 26 years in Sri Lanka amongst others”

This example is chosen not to be critical, but to learn lessons for the future. This is the worst “Financial” Tsunami of Sri Lanka and it is a miracle we stood straight despite the collapse of western economies due to their own folly and “Greed” with utter selfishness. Sakvithi and other episodes too damaged our economy and the trust on the system. Loss of funds of innocent investors and families had to pay the ultimate price for which the investors and the so called regulators were responsible Investments were genuine money mostly of expatriates and also funds swindled via NGO’s and Black money in circulation. Large sums belong to genuine and innocent large and small time investors attracted by high interest rates and personnel media publicity by the directors readily invested due their personal glory to attract investors looking for easy money on interest-some on retirement and some funds collected by selling life time assets. Golden Key has been one of the many unregulated financial institutions blatantly violating the basic principles of monitory management. It damaged the trust on Banks and financial institutions damaging our image in country and abroad. The financial collapse in the west gave some relief to out economy from near collapse. Therefore it is time the financial regulator the Central Bank to bring legislation as a matter of urgency to protect the investors by affording them avenues to monitor and find our the financial management which is their right to know as a main ingredient of the rights formulated by the United Nations.

Central Bank is the is the reserve bank of a State with Exclusive privileges to lend the government its currency, lender of the last resort, lender to banks and the main financial regulator. European Central Bank and Federal Reserve system in the USA manages the respective financials. In Sri Lanka Central Bank is managed based on the management of the Bank of England as the main regulator on finance of the Nation. It implements and maintains the financial policy. Now the Central Bank headed by an able head has taken steps to supervise the errant and illegal financial institutions that were free to swindle the genuine investors who have lost the investments. Other regulator responsible for this mishap is the Consumer Affairs Authority now almost defunct as a result of infighting by the lady Director General sacked twice- Lady Jayasuriya close friend of Silva appointed by former Minister Fernandapullie recommended by the controversial former Chief Justice. On the second occasion Silva directed the Chairman CAA and the Board to take her back- Now she is sacked again. This is a sad situation when the CAA should be active to meet the high cost of living and high prices of unjust traders. This is the era the CAA should be pro active to help the President and the nation to provide the citizen healthy and quality consumer items and services at an affordable price. Central Bank and CAA should have done a lot to protect the financial consumers who would be protected and used for the development as money is a commodity more important and powerful than consumer items. It is still not too late for the two institutions to work together and it is time for the CAA to start the consumer pages again to educate the consumer Trader Industrialist, and the State.

Financial and Insurance Ombudsman in Sri Lanka

These are not Government Institutions. Appointments of this high ranking and important positions are made by the Bankers and Financial Institutions in order to bring about settlements amicably on financial disputes which retard economic developments and development of the country. This procedure has been proved effective and successful with the intervention of the GOOD OFFICE of the two heads of institutions - a respected Law professor and an eminent retired Judge setting an example to the rest of the world. During the period this writer headed the CAA the two institutions worked in harmony with CAA forwarding the issues to each other institutions and engaged in constant dialogs to settle matters amicably. It is time the CAA reactivated the procedure once again as it is a burning need to the community and the business as a whole. To the credit to the two institutions most of the conflicts were settled amicably helping the economy to kick off which we are emerged victorious from the war on terror.


Honesty and transparency in business dealing are rare in Sri Lanka. Consumers are expected to sign blank papers in which the contents are wither in a language not understood or in small illegible letters. During litigations and disputes Fat Cat Lawyers steamrolle innocent consumer either not represented of represented by a junior lawyer! Credit Cards are sold with misdirected information and authority to deduct money from accountants of the employers of the institutions. Credit Card salesmen are hovering round the workplaces on the pay day for their pray and cheat them selling Credit Cards. End of the month only the innocent consumer is left with a balance sheet with all the deductions of expenses with the monthly salary details. If the agreement is for one year the innocent consumer will not be able to get out of the trap for the full year! In the West the consumer is sharp and educated on shrewd business deals and used to living on banks and credit cards. Our culture and breeding is not that. Sri Lanka average citizen does not feel safe to live in a mortgaged house where as in the West majority of property is mortgaged and it is the order of the day. We must not get into the trap of credit card living and living on loans. We should not be a Nation of debtors.

Kennady on 15/03/1962 declared to the congress that consumers are the largest economic group affecting and affected by almost every public and economic decision they are the only important group whose views are often not heard. It is sad yet true that this statement still valid in the present context and it is the Duty of the civil society the statutory institutions and the consumer as a whole to organise themselves in the interest of the society with the wave of organisation initiate by the Consumer International and the media. It is time for us to organise more and more consumer organisations and the non governmental organisations must explore this area instead of not dabbling in our internal political issues. Civil Society and the professionals have to play a major role in this area.

The way forward

The theme this year is most appropriate to us and the entire world as the most important and precious commodity is our own money for which we have no control over and managed by others without our approval. This is a sorry state as there should be better and more accountability and safety for our own funds we earn so hard. We must press for the intervention of the regulators Central Bank, Consumer Affairs Authority and other regulatory bodies’ such as Public Utilities Commission Telecommunication Regulator ect. At the same time the consumer should be alert and organise themselves. CAA mooted this concept during 2005to 2007 and encouraged the concept of “Just Trader and Alert consumer”. (Please refer the book on Consumerism in Sri Lanka by the Author) We must take steps to stop repeat of further financial Tsunami’ in Sri Lanka.

( The Writer, Senior Solicitor Senior Attorney at law and former Chairman of the Consumer Affairs Authority .He can be reached at sarath8@hotmail.com)

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