SriLankan Airlines’ ex-boss held over $2m Airbus fraud

COLOMBO: Kapila Chandrasena, former CEO of SriLankan Airlines — his country’s national flag carrier, has turned himself in to local police in a $2 million graft scandal involving French aircraft producer Airbus.

Chandrasena and his wife, Priyanka Niyomali Wijenayake, were arrested on money laundering charges on Thursday and remanded until Feb. 19 by the Colombo Fort Magistrate’s Court.

Their arrest warrants were issued by the attorney general, who named them as suspects in the case revolving around a deal between SriLankan Airlines and Airbus.

Wijenayake allegedly received $2 million in 2013 to ensure that Sri Lanka bought airplanes from Airbus. The order was canceled when a new Sri Lankan government took office in 2015.

Findings from the UK Serious Fraud Office said Airbus had hired Wijenayake as its intermediary and misled UK export credit agency UKEF over her name and gender, while paying $2 million to her company.

Sri Lanka’s Tourism and Aviation Minister Prasanna Ranatunga said in Parliament on Friday that the government is keen to stamp out corruption and will do its best to compensate people properly for any losses. He added that the previous government had set up a presidential commission to deal with the SriLankan Airlines case, but that it was not “properly pursued.”

Last week, President Gotabaya Rajapaksa said Sri Lanka would conduct “a comprehensive investigation into reports of allegations over financial irregularities after Airbus agreed to settle a corruption probe with regulators.”

SriLankan Airlines has long been a loss-making institution. Between 2009 and 2019, the airlines lost Rs240 billion (roughly $1.3 billion) according to the 2019 Report of the Parliamentary Committee on Public Enterprises.

Sri Lanka was among the countries whose officials were mentioned as having allegedly received bribes in Airbus’ $4-billion settlement with European and US authorities last month.