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Businessmen involved in Undiyal transactions revealed

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The police teams that investigated Undiyal and Hawala money transactions have been able to reveal information about over 80 people who provided facilities to exchange foreign currency through these informal methods.

It was reported that most of the people involved in these illegal transactions are Muslim businessmen.

Police internal sources said that they are investigating a poultry businessman who exchanges about 50,000 US Dollars daily.

‘Sri Lanka Mirror’ learns that the suspect is misusing a license issued by the National Gem and Jewellery Authority of Sri Lanka, to exchange currencies.

It was also revealed that such persons exchange foreign currency through informal methods such as Undiyal and Hawala using cryptocurrency.

Meanwhile, ‘Sri Lanka Mirror’ also learnt that this aforementioned businessman had been living in Kuwait but had returned to Sri Lanka while a financial investigation was being conducted against him in that country.

In addition, police are also looking for information about five people in the areas of Kelaniya, Wattala, Dematagoda and Aluthkade where money is frequently exchanged.

USD 10 million traded daily

According to the Financial Intelligence Unit (FIU) operating under the Ministry of Finance, more than USD 10 million are being received illegally on a daily basis through Hawala and Undiyal systems.

Information has also revealed that these illegal money transactions originate from Italy, UAE, England, Canada, Australia as well as many other European countries.

How does it work?

Undiyal and Hawala are methods of transferring money between two or more countries without the intervention of a bank or other formal financial institution. These methods operate through a network of people spread across many countries.

As an example, let’s take four persons: A (sender of money), B (Undiyal or Hawala broker in the country where A lives), C (Undiyal or Hawala broker in the country where the recipient lives), and D (the recipient of money).

Accordingly, A and B live in one country while C and D live in another.

A gives B the amount to be sent to D. Later, B gives C the amount given by A. C gives the amount to D in the currency of the respective country.

There are also instances where B gives the relevant amount to D from the deposits in his bank account maintained in the country where D lives, without the intervention of a person like C.

These transactions are based on a secret passcode or a mere description without any document or other form of recording.

In these transactions, there is no physical exchange of money across borders, and there is no intervention of a bank or other authorized money exchange agency.

A special police unit

According to the Central Bank of Sri Lanka (CBSL), the significant reduction in the amount of foreign exchange received by the country is the main reason for the worsening economic crisis.

Transferring money outside the banking system using methods such as Undiyal and Hawala has significantly affected the amount of foreign exchange.

Taking these facts into consideration and at the request of the Governor of the Central Bank, the Inspector General of Police recently took steps to appoint a special police unit under the Illegal Assets Investigation Division to conduct investigations into incidents of money exchange through illegal methods.

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Rs. 20 Bn loan lifeline for SMEs

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The government has taken measures to implement a Rs.20 billion credit scheme to revive the micro, small and medium enterprise sector in Sri Lanka.  

Accordingly, the Cabinet of Ministers has granted its consent to the proposal forwarded by President Ranil Wickremesinghe in his capacity as the Finance, Economic Stabilization and National Policies Minister to implement a credit scheme to revive the micro, small and medium enterprise sector.

Speaking at the weekly Cabinet media briefing held yesterday at the Government Information Department, Cabinet Spokesman, Transport, Highways and Mass Media Minister Dr. Bandula Gunawardhana said the proposed Rs.20 billion will be spent on the entire project which has two components.

“Out of this, Rs.15 billion will be used to strengthen existing and new enterprises and the remaining amount of Rs.five billion will be used to support enterprises under the non-performing loan category.

A significant number of small and medium scale entrepreneurs involved in manufacturing, import, export, tourism, apparel and various other commercial operations have found it very difficult to continue running their enterprises as a result of the economic downturn and the impact of external factors beyond their control.

The Asian Development Bank has agreed to provide working capital support for the Small and Medium Enterprise sector as a relief. The proposed programme is intended to provide credit facilities to existing micro, small and medium scale enterprises for further expansion and recovery of their businesses through licensed commercial banks and licensed specialised banks at concessional interest rates.

(dailynews.lk)

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Bakery industry in crisis as bread and bun sales decline

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The All Ceylon Bakery Owners’ Association (ACBOA) has reported a significant drop of around 50% in the sales of cakes, bread, and buns in the local market. The association attributes this decline to the high manufacturing costs currently faced by the bakery industry.

According to the ACBOA, the costs of margarine and butter have surged to Rs. 1,000 and Rs. 3,000 per kilogram, respectively. Additionally, the association cited challenges in obtaining imported eggs from India, forcing them to purchase locally produced eggs at Rs. 60 each.

The chairman of the association expressed concerns about the impact these rising costs have on the bakery industry. In light of these challenges, the ACBOA is urging the government to provide concessions and work towards reducing the prices of essential ingredients before the upcoming Sinhala and Hindu New Year.

The association’s plea emphasizes the need for government support to help stabilize the bakery industry and ensure its sustainability amid the current economic challenges. Further updates on the situation and any government response will be monitored closely.

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Former Minister Ronnie de Mel no more

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Former Minister – Ronnie de Mel has passed away today (27) while being treated at a private hospital, reports say.

He was aged 99 years old.A former civil servant, he was the Minister of Finance from 1977 – 1988 under the United National Party government and holds the record for the largest number of budgets presented by a finance minister.

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