The Board of Investments today clarified that all transactions by the investor related to the oil refinery at the Mirijjawila Export Processing Zone in Hambantota are routed through a reputed commercial bank of Sri Lanka.

"All commercial banks have their own AML/CFT regulations," the BOI said in a communique this afternoon. 

"Foreign Direct Investment brought to Sri Lanka, including the oil refinery project in Hambantota, is channeled through the approved local banking system through Inward Investment Accounts (IIA) as per the foreign Exchange Act and its regulations.," the statement added. 

The BOI statement a day after Transparency International said the controversy surrounding the proposed USD 3.85 billion oil refinery in Mirijjawila, Hambantota, could have a negative impact on Sri Lanka’s efforts to remove itself from the Financial Action Task Force’s (FATF) ‘Grey List’ of countries vulnerable to money laundering and terrorism financing.

TISL said: "The main investor in the project, the Singapore based ‘investment vehicle’ Silver Park International PTE Ltd, is a company controlled by the family of Tamil Nadu politician and former Indian Union Minister Dr. S. Jagathrakshakan, whose business interests have previously been implicated by Indian authorities and the media in several alleged corruption scandals. Of the 40 FATF recommendations which set the international standards on combating money laundering, recommendation 12 requires that reasonable measures are taken to ascertain the source of wealth and source of funds in transactions involving politically exposed persons."