This racket had functioned under the guise of an international education institute and some military officers had even deposited around Rs. 05 million, reports say.
Some, who had even deposited money obtained from fellow soldiers and family members, are now unable to face their families and comrades at camp, reports add.
In order to re-earn the lost money, there is a trend of helpless depositors resorting to drug trafficking order.
The revelation has been made by the 'Aruna' newspaper and 'Sri Lanka Mirror' learns that an institute named as the Athens International Education Center and operated by one Sahan Akalanda has faced this allegation.
It is said that the relevant institution has also carried out CSR projects in collaboration with the police and Swarnavahini.
It is reported that the institute has also carried out publicity campaigns which indicates that it enjoys close relations with former President Maithripala Sirisena and current Minister Roshan Ranasinghe.
According to reports, Sahan has gone missing from his home and a large sum of money in his Bank of Ceylon account has been frozen.
However, it is reported that he has an amount of money that he can use in another account.
Meanwhile, it was revealed that 9,440 members of the Armed Forces and the Police had defrauded another company based in Kurunegala, that is owned by a film producer.
Reports say that a number of bank accounts and assets of this person have been frozen by the Central Bank and have been referred to the Attorney General for further action.
Meanwhile, it is reported that persons victimised by the racket including officers of the tri forces and police, are planning to hold a protest next Saturday against this racket based in Kurunegala.
They are protesting to pressurise security forces and the government to arrest the company owner who is currently in hiding after swindling Rs. 2,000 million. They are further asking for their lost money.
It is said that these racketeers have been having close associations with politicians, senior police officers as well as the heads of state institutions.
It is also suspected that both the businesses were used for money laundering.