The Committee on Public Finance (COPF) today released its final report into the USD 2.5 million cyber fraud linked to Sri Lanka’s foreign debt repayments to Australia, highlighting widespread governance, procedural and operational failures and recommending sweeping reforms.

Key findings from the report:

1. USD 2.5 million stolen – The report concludes that a cybercrime-linked fraud resulted in the loss of USD 2.5 million in public funds during foreign debt repayments to Australia. 
2. Senior officials held responsible – COPF says governance lapses at the level of the Secretary to the Treasury and the Central Bank Governor contributed to the failures that allowed the fraud to occur. 
3. Outdated email system exposed Treasury – The Ministry of Finance was using an outdated Microsoft Exchange Server after security support had ended, while basic cybersecurity measures, including multi-factor authentication, were absent. 
4. Fraud attempts involved multiple countries – The COPF report reveals that suspicious or fraudulent payment instructions were identified in connection with Sri Lanka’s debt repayments involving India, the UK, Germany and Belgium, helping authorities prevent further losses. The USD 2.5 million cyber fraud occurred only in repayments to Australia.
5. Basic verification failures identified – Officials failed to verify lender email domains, relied on unverified email communications and lacked effective internal controls, allowing the fraud to continue for months. 
6. Only four officials suspended – Despite finding system-wide failures across multiple institutions, the report notes that only four mid-level Ministry of Finance officials have been suspended so far. 
7. Special audit and reforms recommended – COPF has called for a special audit of the entire foreign debt repayment process, stronger cybersecurity across government institutions, updated financial regulations and improved public debt management systems. (Newswire)

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The Colombo Fort Magistrate’s Court today directed the Criminal Investigation Department (CID) to submit a progress report on August 5 regarding investigations into the alleged fraudulent withdrawal of USD 2.5 million in government funds belonging to the Central Bank of Sri Lanka during a Treasury loan repayment.

The case was taken up before Magistrate Pasan Amarasena. 

CID officials informed court that 16 terabytes of computer data linked to the probe had been referred to the University of Colombo for further examination, but reports have not yet been received.

The CID further noted that government analyst reports connected to the incident are also pending.

After reviewing the submissions, Magistrate Amarasena ordered the CID to update the court on the status of the investigations by August 5. (Newswire)

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The Committee on Public Finance (COPF) convened in Parliament this week (08) to deliberate on the Ministry of Finance’s report regarding the disappearance of US$ 2.5 million held by the Treasury for government debt settlement.

Chaired by MP Harsha de Silva, Finance Secretary Dr. Harshana Suriyapperuma, Central Bank Governor Dr. Nandalal Weerasinghe, and officials from the Sri Lanka Computer Emergency Readiness Team (CERT) joined the discussion.

During the meeting, Central Bank officials informed the committee that they would submit a separate report after reviewing the Finance Ministry’s findings.

COPF Chairman Harsha de Silva stated that once both reports are considered, a final report will be prepared and submitted to Parliament.

The session was also attended by Deputy Ministers Chathuranga Abeysinghe, Kaushalya Ariyarathne, Nishantha Jayaweera, and MPs Ravi Karunanayake, Harshana Rajakaruna, Nimal Palihena, Chithral Fernando, Wijesiri Basnayake, and Lakmali Hemachandra. (Newswire)

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The Ministry of Finance has invited think tanks, universities, professional bodies, private sector institutions, registered NGOs, and individual citizens to submit proposals aimed at strengthening Sri Lanka’s medium‑ and long‑term revenue strategies.

The invitation comes through the Revenue Management Committee, established under the State Finance Management Act No. 44 of 2024, which is tasked with preparing strategies to raise government revenue, improving coordination among revenue‑generating institutions, and providing policy guidance. 

The government’s long‑term target is to increase state revenue to 20% of GDP by enhancing efficiency, broadening the tax base, and formalizing the informal economy.

Proposals may cover areas such as:

• Medium‑ and long‑term strategies to increase revenue
• Formalizing the informal economy and expanding the tax base
• Digitization of revenue institutions to improve efficiency
• Policy‑aligned collection methods
• Encouraging voluntary tax compliance and strengthening administration
• Technology‑based revenue systems and data analysis
• International best practices in revenue administration

Proposals must be submitted in PDF format, including a summary of the strategy, implementation method, expected fiscal or administrative impact, potential risks, and relevant institutional or personal details.

The deadline for submissions is June 16, 2026, with proposals to be sent via email to dgfp@fpd.treasury.gov.lk. 

Issuing a notice, the Committee said it reserves the right to accept, reject or seek further clarifications on submissions. (Newswire)

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Sri Lanka’s Treasury has received a tranche of USD 695 million following the successful completion of the 5th and 6th reviews of the International Monetary Fund (IMF) programme, Deputy Minister of Finance Anil Jayantha Fernando confirmed.

The IMF Executive Board approved the reviews at its meeting held on May 27. With the latest tranche, total IMF financial support disbursed to Sri Lanka under the programme has reached approximately US$2.4 billion.

In a recent statement announcing the approval for the disbursement of funds, the IMF said Sri Lanka’s performance under the reform programme remained “generally strong”, despite global and domestic challenges, including the war in the Middle East and the aftermath of Cyclone Ditwah.

The IMF noted that Sri Lanka had met all end-December 2025 quantitative performance criteria, while most structural benchmarks had either been achieved or implemented with delays.

The fund also confirmed that prior actions related to restoring fuel and electricity cost-recovery pricing had been completed.

The IMF projects Sri Lanka’s economic growth to slow to 3% in 2026, down from 5% in 2025, mainly due to global uncertainties and rising oil prices linked to the Middle East conflict.

Inflation is expected to rise to 5% in 2026, while the current account balance is projected to return to a deficit.

The IMF said fiscal easing in 2026 was appropriate in response to economic shocks, including recovery spending following Cyclone Ditwah, but stressed that Sri Lanka must return to its fiscal targets from 2027 onwards. (Newswire)

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Sri Lanka Podujana Peramuna (SLPP) MP Namal Rajapaksa has insisted that the $2.5 million Treasury debt diversion scandal cannot be dismissed as a “technical error,” stressing that it raises serious questions of public finance accountability under the Public Finance Management Act No. 44 of 2024.

In a post on X, Rajapaksa pointed out that under Sections 4 and 28 of the Act, the Minister of Finance is responsible for fiscal oversight and authorising expenditure warrants, while under Sections 5, 29 and 36, the Secretary to the Treasury is tasked with operational control and safeguarding computerized public financial systems.

He argued that if warnings were raised and an unsecured system was still used to handle public funds, accountability cannot be separated between policy approval and administrative execution, and both levels must be examined.

“This is now a test of consistency and transparency in governance: will the same standards of accountability that are publicly stated be applied equally when a complaint is formally made, and names arise in an investigation?” Rajapaksa wrote.

He further recalled President Anura Kumara Dissanayake’s statement on May 12 that if a person’s name arises in an investigation, a statement must be recorded “even from the President himself,” adding that no one is above the law.

“That principle must now be applied uniformly, without exception or delay,” Rajapaksa said. (Newswire)

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The Central Bank of Sri Lanka (CBSL) and the Ministry of Finance are working together to strengthen systems and prevent a repeat of the alleged fraudulent transfer of USD 2.5 million belonging to the Finance Ministry, CBSL Governor Dr. Nandalal Weerasinghe said.

The Governor made these comments addressing the media briefing at the Central Bank today (13), Dr. Weerasinghe said both institutions are reviewing existing procedures and using their expertise to introduce safeguards against similar incidents in the future.

Responding to questions from journalists, the Governor clarified that, as the banker to the government, the Central Bank is not directly responsible for altering or verifying payment instructions issued by account holders

He explained that once account details and payment mechanisms are properly verified, the Central Bank’s role is limited to processing the transaction.

“For an example, if your bank is instructed to make a payment from your account to another account, the bank’s responsibility is to verify the bank account number. If the system recognizes it, the payment will be made, that is what they do. Beyond that, the bank does not have a right to change the instructions you have given,” Dr. Weerasinghe explained. 

He further stated that banks do not have the authority to change customer instructions, while confirmation of receipt after a transfer is generally handled by the receiving institution.

He added that statements related to the fraudulent transaction in question would have been received by the relevant institution in Australia. (Newswire)

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Minister of Public Security Ananda Wijepala informed Parliament today that statements have been recorded from 21 individuals in connection with the USD 2.5 million cyber theft at the Treasury.

He said a complaint has been filed with the Criminal Investigations Department (CID) regarding the incident, and that a comprehensive investigation is currently underway.

“An investigation is underway into the incident. If there are persons responsible for the money transfer to a third party, they will be brought before the law. There is no argument on this,” the Minister stated.

Pointing out that this is not the first financial misappropriation to occur in Sri Lanka, Wijepala stressed that the government will take the necessary legal action in this regard. (Newswire)

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A tense situation arose in Parliament today (05) when the Opposition demanded an urgent debate on the US$2.5 million Treasury cyber theft.

Chief Opposition Whip MP Gayantha Karunathileke told the House that a written request had been submitted to the Speaker. 

Following the proposal, several Opposition MPs stood in their seats, pressing the government to allow the debate.

Responding, Speaker Jagath Wickramaratne clarified that an urgent debate can only be held if the proposal is submitted before the session begins and approved by both the Speaker and Parliament.

A heated exchange ensued between the Speaker and Opposition MPs, after which Leader of the House Bimal Rathnayake informed the chamber that the government was prepared to hold the debate today.

Minister Rathnayake announced that the government was open to holding the urgent debate from 3.30 p.m. to 5.30 p.m. (Newswire)

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Former Minister Udaya Gammanpila has questioned the credibility of the post-mortem examination into the death of Finance Ministry Assistant Director Ranga Nishantha, describing both the death and the investigation as “suspicious.”

Speaking at a media briefing, the Pivithuru Hela Urumaya leader said the conclusion that Nishantha’s death was likely a suicide due to excessive bleeding from multiple cut injuries was premature and lacked sufficient forensic backing.

Gammanpila raised concerns that key forensic procedures, including toxicology and pathology tests, had not been completed before the conclusion was reached. He said it was not possible to determine whether the death was a suicide or a homicide until such examinations were finalised.

He also questioned why the Police had described the death as a suicide before the post-mortem findings were complete.

Nishantha, who had reportedly lodged a complaint with the Criminal Investigation Department over an alleged cyber fraud, was found dead at his residence, raising broader concerns about the impact on ongoing investigations.

Gammanpila said the victim’s wife had formally complained to the Police that the death was suspicious, a concern that was also noted in official correspondence related to the inquiry.

He further called for forensic analysis of fingerprints on the weapon involved, as well as blood samples found at the scene, to determine whether other individuals were involved.

The former minister also questioned the composition of the post-mortem panel, alleging potential bias and calling for a fully independent investigation.

He urged authorities to appoint a new panel of senior forensic experts to conduct a fresh examination, saying it was necessary to restore public confidence. (Newswire)

සිය සැමියාගේ මරණය සැක සහිත බවට රංග නිශාන්ත මහතාගේ බිරිඳ පොලිසියට පැමිණිලි කළ බව සෞඛ්‍ය අධ්‍යක්ෂ ජනරාල්වරයා සහ කුලියාපිටිය මහෙස්ත්‍රාත්වරයා විසින් තහවුරු කළ ලිපි pic.twitter.com/VE9V5l9lxd

— Udaya Gammanpila (@UPGammanpila) May 4, 2026

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According to Ada Derana, quoting Police sources, the death is suspected to be a suicide, although there has been no official confirmation yet.

He had been under investigation following the high-profile incident involving the diversion of state funds, believed to have been carried out by hackers through compromised communication channels.

The deceased had been suspended from duty pending the outcome of ongoing investigations into the incident.

Police said further inquiries are underway to establish the circumstances surrounding the death. (Newswire)

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Committee on Public Finance (COPF) Chairman Harsha de Silva says he has not been informed of Treasury Secretary Harshana Suriyapperuma’s appearance before the committee today (30) regarding the US$2.5 million cyber theft from the Treasury.

“I do not know, and I have not been informed. However, I did not accept his refusal to be present today and request for another day. I have written to him and told him that the Committee will meet as planned,” MP Harsha said in a statement on ‘X’.

His comments come as reports emerged that Suriyapperuma, along with senior Finance Ministry officials, will appear before the COPF at 01.00 pm today to provide explanations over the US$2.5 million cyber theft from the Treasury.

Suriyapperuma is reportedly appearing before the COPF today, despite having earlier informed the committee in writing that he was unable to attend today’s session and requested an alternative date after May 5, citing the President’s expected statement in Parliament on the matter.

The COPF meeting is scheduled to proceed this afternoon, with members expected to deliberate on the alleged diversion of USD 2.5 million in Treasury funds, in a case linked to a suspected email scam involving a foreign debt repayment.

The payment, made as part of Sri Lanka’s external debt servicing process, had been redirected to a third party through a fraudulent email resembling that of Australia’s Export Finance Agency. (Newswire)

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Secretary to the Ministry of Finance and the Treasury, Harshana Suriyapperuma, will appear before the Parliamentary Committee on Public Finance (COPF) today (30), regarding the cyber theft involving US$2.5 million from the Treasury.

It is reported that the Finance Ministry Secretary will report to the COPF along with several senior officials of the Ministry of Finance at 01.00 pm. 

Suriyapperuma had been summoned along with senior Finance Ministry officials to appear before the COPF to provide explanations over the  US$2.5 million cyber theft. 

However, Suriyapperuma had informed the COPF in writing that he is unable to appear before the committee on Thursday (30). 

COPF Chairman Harsha de Silva confirmed that the committee received a letter from the Finance Ministry Secretary yesterday notifying them of his inability to attend the scheduled session, and that he had requested an alternate date after May 5th.

According to de Silva, the Finance Ministry Secretary had sought a postponement as the President is expected to make a statement in Parliament on the matter before that date. (Newswire)

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Sri Lanka’s Criminal Investigation Department (CID) on Tuesday informed the Colombo Fort Magistrate’s Court that investigations are underway into the alleged diversion of USD 2.5 million in Treasury funds, in a case linked to a suspected email scam involving a foreign debt repayment.

Officials told the court that the payment, made as part of Sri Lanka’s external debt servicing process, had been redirected to a third party through a fraudulent email resembling that of Australia’s Export Finance Agency.

The CID, reporting to Magistrate Isuru Neththikumara, said a 27-page report containing sensitive details had been submitted and requested that it be placed under secure custody due to the nature of the investigation.

According to investigators, the incident stems from a complaint lodged on March 24, 2026. The funds were intended for an official payment to an Australian government-linked institution through the External Resources Department and the State Debt Management Office.

However, a fraudulent email, closely mimicking the legitimate domain, had been used to send payment instructions. The original domain “exportfinance.gov.au” had allegedly been altered to “exportfinance.av.com,” leading to the transfer being made without further verification.

CID officials said they are examining whether there had been any unauthorised access to the email systems of the External Resources Department or related institutions. Initial checks with the Sri Lankan firm managing the email servers have not yet confirmed a breach, though further forensic analysis is ongoing.

Investigators noted that the system processes around 15,000 emails daily, complicating efforts to trace potential intrusions. They also told the court that, despite a prior warning regarding the suspicious domain change, the payment had been processed after the alert was issued.

The court was further informed that standard verification procedures for such transactions appeared to rely primarily on email communication, with no additional confirmation mechanisms in place before funds were released.

The CID said investigations are also exploring whether systems of the Australian institution may have been compromised. Assistance is being sought from international agencies, including Interpol and the Australian Federal Police.

No suspects have been named so far. However, the CID requested travel bans on five individuals believed to be directly linked to the email exchanges, along with permission to examine their bank accounts.

The court granted the requests and also approved the appointment of a technical committee comprising experts from the Sri Lanka Computer Emergency Readiness Team (SLCERT), the Government Analyst’s Department, and the University of Colombo’s Faculty of Computing.

Magistrate Isuru Neththikumara instructed investigators to determine whether a criminal offence had occurred, identify those responsible, and take urgent steps to prevent similar incidents in future.

The case is scheduled to be taken up again on June 3 for further progress. (Newswire)

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Supporters of the New Democratic Front, led by Sugeeshwara Bandara, staged a protest outside the residence of Finance Ministry Secretary, Harshana Suriyapperuma, in Pelawatta, Akuregoda, on Tuesday (28).

The demonstration was held to protest the recently reported $2.5 million Treasury cyber fraud.

During the protest, former President Gotabaya Rajapaksa’s Private Secretary, Sugeeshwara Banadara and several others were attacked with cow dung.

A tense situation arose between the two groups, prompting police intervention to restore order. (Newswire)

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Prime Minister Harini Amarasuriya says the government is taking the necessary legal action regarding the recent financial fraud involving unauthorized access to the computer system of the Department of External Resources under the Ministry of Finance. 

She noted that investigations have already commenced, with international assistance offered.

“In particular, the Government of Australia has informed us of its willingness to support the investigative process, as stated by the Australian High Commissioner,” the Prime Minister said.

Prime Minister Harini Amarasuriya further criticized the opposition, stating that they continue to attempt to inconvenience the government by raising baseless arguments, including false allegations against ministers. 

“A democratic country needs an opposition. However, the opposition still seems not to understand what the people expect from it. They are attempting to seize power through any means,” she said.

Pointing out the opposition’s claims of bridging a No-Confidence motion against her, PM Harini Amarasuriya said she was waiting for the move.

“They even said they would bring a no-confidence motion against me. I am also waiting for them to submit it to Parliament. Then I will have the opportunity to present my facts and respond,” she said. 

She made the remarks while speaking after paying respects to the Most Venerable Thibbatuwawe Sri Siddhartha Sumangala Abhidana Mahanayake Thero of the Malwathu Chapter, in Kandy today (24).

The comments come amid ongoing investigations into the cyber theft incident involving the Treasury, where Finance Secretary Harshana Suriyapperuma recently confirmed efforts are underway to recover as much as possible of the USD 2.5 million stolen by cyber criminals. (Newswire)

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The Secretary of the Ministry of Finance, Harshana Suriyapperuma, says that efforts are being made to recover as much as possible of the USD 2.5 million that cyber criminals obtained from the Ministry of Finance.

He made this statement while participating in a media briefing held today (23) at the auditorium of the Ministry.

Harshana Suriyapperuma further said that these hackers had entered the relevant system through email.

He further said that the Australian High Commissioner and the creditor had been informed regarding this incident.

“In January 2026, we came to know that cyber criminals were trying to enter the External Resources Department’s system. When such information was reported, we coordinated with the relevant foreign countries and ensured that no harm was caused to the country that was to receive the payment. That issue was resolved. We felt the need to prepare the necessary procedures to review past payments, because even before January, similar incidents had occurred. Accordingly, it took some time. During that period, it was revealed that the hackers’ activities had also affected a past payment in January,” he said.

Harshana Suriyapperuma noted that it was confirmed that the cyber criminals had accessed emails and defrauded nearly USD 2.5 million from the Ministry of Finance. 

“Even though Sri Lanka had made the due payments, the cyber criminals had intervened and diverted it to other bank accounts, instead of the intended recipient,” he said. 

He added that following these complaints were filed with the Criminal Investigations Department (CID) and the Financial Intelligence Unit (FIU) of the Central Bank of Sri Lanka on the incident. 

The Secretary of the Ministry of Finance further said that a committee has been appointed, comprising high-ranking officials of the Finance Ministry and two Deputy Secretaries of the Treasury, to conduct a comprehensive investigation into the matter. 

He added that actions, including disciplinary action against officers, have been taken based on the reports of the committee obtained thus far. (Newswire)

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The Australian High Commission in Sri Lanka has confirmed that both the mission and Sri Lanka’s Ministry of Finance are aware of irregularities in payments owed to the Australian Government.

Sri Lankan authorities have launched an investigation into the matter and are coordinating closely with Australian officials, who are assisting the inquiry, the Australian High Commission said in a statement on ‘X’. 

The High Commission further said that Australia remains committed to supporting Sri Lanka’s path toward debt sustainability.

The statement comes after Deputy Minister of Finance Dr Anil Jayantha announced that complaints have been filed with law enforcement agencies following a cyber theft incident involving unauthorised access to the computer system of the Department of External Resources under the Ministry of Finance.

He said the incident occurred during communication and fund settlement activities between the Australian Export Finance Agency and the Treasury, where both parties exchanged information via email. 

Hackers allegedly exploited this communication channel to manipulate the information exchange,he said, adding that the fraud came to light after a similar attempt was made to obtain additional funds linked to a payment due to India. 

He further said that suspicion arose when changes were detected in account numbers. Following this, the Treasury immediately alerted the Sri Lanka Police Computer Crimes Investigation Division and the Sri Lanka Computer Emergency Response Team (CERT), after which a lengthy investigation was then carried out tracing communications back to the start of discussions on debt restructuring and repayments.

This established that money intended for the Australian Export Finance Agency had been diverted into accounts controlled by the hackers. A complaint has since been filed with the Criminal Investigation Department (CID), and investigations are ongoing, Deputy Minister of Finance Dr Anil Jayantha added. (Newswire)

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Opposition Leader Sajith Premadasa has alleged that the country’s financial security is at risk following reports that USD 2.5 million meant for a foreign debt repayment was diverted to a hacker through fraudulent instructions.

Speaking to the media in Kataragama today, Premadasa said the reported loss occurred during the repayment of a foreign loan instalment and raised serious concerns over the government’s financial management systems.

He claimed that the funds had allegedly been obtained by a hacker through false information and questioned how such a transaction could have taken place without proper verification.

Premadasa said the incident suggested that the Ministry of Finance, Treasury, and Central Bank of Sri Lanka lacked the ability to properly manage the country’s financial operations.

He warned that if foreign currency reserves could be lost through forged confirmations and fraudulent instructions, the nation’s financial security was under threat.

The Opposition Leader further said the matter had created a broader national security concern, citing weaknesses in the country’s financial systems.

He questioned whether relevant institutions, including the State Debt Management Office, Department of Foreign Resources, Treasury, Finance Ministry, and Central Bank, had established adequate procedures to process such payments.

Calling the matter serious, Premadasa urged authorities to launch an independent and transparent investigation to determine how the funds were allegedly misdirected and whether due verification procedures had been ignored.

He said those responsible must be identified through an impartial probe. (Newswire)

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President Anura Kumara Dissanayake praised outgoing Treasury Secretary Mahinda Siriwardana for his service, highlighting his role in stabilizing the economy after the debilitating economic crisis.

Speaking at a farewell event at the Presidential Secretariat, the President commended Siriwardana’s dedication and leadership, and called for a values-driven public service focused on empathy and merit, the President’s Media Division (PMD) said.

Young public officials have much to learn from the distinguished career of Mr Mahinda Siriwardana, a senior public servant with extensive experience and profound understanding, the President said.

Siriwardana, reflecting on his three-year tenure, described it as the most significant of his career. He also expressed his gratitude to President Dissanayake for maintaining confidence in him and allowing him to continue in the position despite a change in government leadership, noting that the President’s support was a great source of strength.

A commemorative token was presented to Siriwardana in recognition of his contributions. (Newswire)

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