* Offences compounded
The country’s capital market watchdog the Securities and Exchange Commission of Sri Lanka (SEC) issued the following statement confirming that Environment Resources Investments PLC and its directors had been fined Rs. 9.9 million in total while its Chairman Lalith Heengama was fined Rs. 500,000 for non-disclosures and dissemination of misleading information to the CSE relating to certain material information concerning the company.
"The Securities and Exchange Commission of Sri Lanka (SEC) by virtue of the powers vested in it under the provisions of the Securities and Exchange Commission of Sri Lanka Act No. 36 of 1987 as amended, conducted an investigation pertaining to certain corporate disclosures made to the Colombo Stock Exchange (CSE) by Environmental Resources Investments PLC (ERI PLC) and the Board of Directors thereof.
The evidence elicited during the above investigation suggested that ERI PLC and the Board of Directors thereof have contravened the Listing Rules of the CSE as well as the SEC Rules published in the Gazette Extraordinary No. 1215/2 dated 18th December 2001 through certain non-disclosures and dissemination of misleading information to the CSE relating to certain material information concerning the Company. The said non-disclosures and dissemination of misleading information were particularly in respect of certain related party transactions as well as cross border investments of ERI PLC. However, subsequent disclosures have been made to the CSE by the Company pertaining to the aforesaid material information approximately a year after the said disclosures should originally have been made.
The Members of the Commission at its 283rd Meeting, held on 10th August 2011, having considered the matters pleaded by ERI PLC and the circumstances surrounding the commission of the offences referred to above, decided to compound the said offences against the Company, the Chairman and the two Executive Directors thereof in terms of Section 51A of the Securities and Exchange Commission of Sri Lanka Act No. 36 of 1987 as amended, upon payment of sums of money to be credited to the Compensation Fund of the SEC by the said parties.
It is provided in Section 51A of the Act that the ‘Commission may having regard to the circumstances in which the offence under this Act was committed, compound such offence for a sum of money not exceeding one-third of the maximum fine imposable for such offence ………………..’, and in terms of Section 51(2) of the Act the maximum fine imposable by a Magistrate on conviction after a summary trial for an offence (for which no penalty is expressly provided in the Act) is Rupees Ten Million (Rs. 10 Million).
Consequently, the following payments were effected on behalf of ERI PLC, the Chairman and the two Executive Directors:
* A sum of Rupees Three Million and Three Hundred Thousand (Rs. 3.3 Million) on behalf of ERI PLC
* A sum of Rupees Three Million and Three Hundred Thousand (Rs. 3.3 Million) on behalf of Dr. Kosala Heengama, the Executive Director
* A sum of Rupees Three Million and Three Hundred Thousand (Rs. 3.3 Million) on behalf of Mr. Gregory Scott Newsome, the Executive Director
* A sum of Rupees Five Hundred Thousand (Rs. 500,000/-) on behalf of Mr. Lalith Heengama, Chairman
Having considered the circumstances of this matter, the two Independent Directors namely Mr. G. S. Munasinghe and Mr. H. B. Dissanayake were warned by the Commission."
The above mentioned sums of money were credited to the Compensation Fund of the SEC, and thereafter the offences against the Company, the Chairman and the two Executive Directors thereof were compounded.
source - www.island.lk
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