02 November 2023
Subaskaran at the inauguration of Lyca Productions Lanka, Colombo, August 2023.
The Tamil-owned telecoms company Lycamobile has had its former CEO convicted and was ordered to pay a fine of €10 million after being found guilty of money laundering and fraud by a French court last month, just weeks after the company launched a Sri Lankan production arm looking to boost Sinhala-language cinema.
The verdict in the Parisian court comes after years of controversial practices by the multimillion-dollar company, which is reported to have links with the war crimes accused Rajapaksa family in Sri Lanka. The group’s former chief executive officer Christopher Tooley received the prison sentence, alognside Alain Jochimek, managing director of Lycamobile France and Lycamobile Services. The Lyca group said that the accusations of money laundering "concern the activities of two salespeople who were laid off and dismissed upon the discovery of this parallel activity,"
according to Le Monde, with reports it may appeal the decision.
In 2016, Lycamobile’s Paris offices were raided and 19 people were arrested on suspicion of money laundering and tax fraud. BuzzFeed reported at the time that “Lycamobile’s own auditors declared over the past two years that they could not account for a total of £646 million that moved through ten companies in its complex corporate network”. In the UK, BuzzFeed reported on how rucksacks stuffed with millions of pounds in cash would be deposited at Post Offices all over London in 2015. At the time the company was one of the Conservative Party’s
largest donors. A formal investigation was never opened by British authorities.
See more from BuzzFeed
here and
here.
Accused of links to the Rajapaksa regime
Mahinda Rajapaksa sits before a Lyca sponsored billboard in Colombo, 2013.
More controversially, the Lyca group has also been accused of holding close ties to the Rajapaksa clan. Mahinda Rajapaksa and his brother Gotabaya oversaw an offensive that slaughtered tens of thousands of Tamil civilians in 2009, a series of massacres that have increasingly been recognised as a genocide. Despite being owned by a Tamil born on the island, Lycamobile went on to forge links with the accused war criminals.
According to
Corporate Watch, Hastings Trading e Serviços Lda, a company listed as being 90.5% owned Allirajah’s wife Premantharshini Subaskaran, bought a 95% share in a dormant firm registered with Rajapaksa's nephew, Himal Lalindra Hettiarachchi in 2007. The purchase of the company, Sky Network, came as hostilities between the Sri Lankan government and Liberation Tigers of Tamil Eelam (LTTE) began to escalate.
The company went on to receive a key license to operate cutting-edge wireless broadband frequencies, forcing the state telecom firm that failed to get the licence to merge with it at a cost of US$100 million.
Sri Lanka Telecom reportedly poured US$10 million into the company, yet former chief executive Greg Young told BuzzFeed that it was “never able to successfully capture a customer”. “It was a company that effectively had no assets, had no operations, and had no value – so effectively SLT bought something, paid for it, and it had no value,” he claimed.
Rajapaksa’s nephew Hettiarachchi however secured a lucrative salary of several thousand dollars per month alongside “an office, a car, a driver, an expense allowance,” and more. His contract was reportedly renewed following pressure from Rajapaksa’s wife Shirianthi, who would call Young directly. After Mahinda Rajapaksa lost presidential elections in 2015, senior government and police officials in Colombo told
BuzzFeed News a probe was being launched into the deal which they suspect was a “shell company” that the former president’s nephew used to enrich himself through a “shady transaction”. Then cabinet spokesman Rajitha Senaratne told BuzzFeed that once out of office, the Rajapaksa family had gone to great lengths to conceal at least US$10 billion through offshore accounts and shell companies.
In 2013, as Eelam Tamils called on world leaders to boycott the 2013 Commonwealth Heads of Government (CHOGM) summit that was taking place in Colombo and being hosted by Rajapaksa,
Lyca was one of the Gold Sponsors of the Commonwealth Business Forum that was taking place on the side lines. Deals worth more than $2bn were expected to be signed during the forum, according to the Sri Lankan government.
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