Thursday 26 May 2016

Sri Lanka Blue Diamonds Jewellery audit reveals fraud: SEC

ECONOMYNEXT - Sri Lanka's Securities and Exchange Commission said an audit ordered of the books of Blue Diamonds Jewellery Worldwide Plc, has found possible misappropriation of public funds and capital market offences and offences under the penal code.

A statement said the SEC will conduct further investigations into the company and was taking all steps necessary to protect the interests of investors.

The audit by Ernst and Young, an accounting firm, was ordered by the SEC over allegations of accounting fraud and mis-use of funds in a rights issue.

The SEC said the audit by found “several irregularities in the conduct of business affairs of Blue Diamonds by the management which may point to the possible misappropriation of public funds” raised by the rights issue.

It also found “possible commission of one or more capital market offences as well as offences under the penal code,” the SEC said.

It said Blue Diamonds Jewellery Worldwide had sought time to respond to the audit report.

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