In Remand

Feb 26, 2009 (LBO) – Lalith Kotelawala, chairman of Sri Lanka’s Ceylinco group, has been arrested and remanded over an alleged fraud that caused the collapse of group firm Golden Key Credit Card Company.

The magistrate court order to remand Kotelawala was given when the case on an alleged fraud at Golden Key was taken up Thursday, court officials said.

The magistrate ordered that Kotelawala and another director be remanded till March 11, and for the company to repay 26 billion rupees to depositors within 10 days.

The court also issued an arrest warrant on Kotelawala’s wife, Sicille Kotelawala, who is a director of the company and is believed to be abroad.

Kotelawala’s Ceylinco Group is one of the largest diversified companies in Sri Lanka that have business interests in banking, finance, insurance and property development.

Its subsidiary Golden Key went bust two months ago, when it found itself unable to repay depositors or pay interest on deposits.

The company is believed to have invested in real estate.

But it got into trouble with the collapse of the property bubble.

In December Kotelawala placed an advertisement in the newspapers summoning Golden Key depositor