105 shell companies, 24,300 wire transfers, and forged customs papers: how a fake-import scheme drained over Rs. 214 billion out of Sri Lanka’s banking system
By The Pulseline News Desk
The Criminal Investigation Department (CID) has told Parliament that it has traced roughly $715 million — about Rs. 214.7 billion — that flowed out of the country’s banking system through a sprawling network of fraudulent import transactions, in what investigators describe as one of the largest trade-based money laundering schemes uncovered in the country in recent years.
Senior Deputy Inspector Genera (SDIG)l of Police Asanka Karawita, who heads the CID, has briefed the Committee on Public Finance (COPF) on the scale of the operation: 105 companies, 55 individuals, and 227 bank accounts, all allegedly channelling money overseas between January 2023 and March 2026 without a single shipment of goods ever entering the country.
A paper trail
The mechanism, according to Karawita, was deceptively simple. Companies would apply for telegraphic transfers to pay for imports, backing the applications with invoices and customs documentation submitted to banks. The catch: the goods didn’t exist. The CID says the paperwork was forged from start to finish, allowing the companies to move money abroad under the guise of legitimate trade.
Investigators had counted around 24,300 individual wire transfers tied to the scheme — a volume that points to a systematic, sustained operation rather than a handful of opportunistic transactions. The case had first come to the CID’s attention after Sri Lanka Customs had flagged irregularities and lodged a formal complaint, triggering the investigation that has now run for more than three years of activity under scrutiny.
Thirteen state and private banks have been identified as having processed transactions linked to the network, raising questions about how forged documentation passed through multiple layers of institutional checks for so long.
One suspect, 43 companies, $43 million
The scale of the fraud at the individual level has also drawn attention. Karawita has told the committee that one suspect alone is allegedly connected to 43 of the 105 companies implicated in the scheme, accounting for around $43 million in outward transfers. That suspect has already been arrested and remanded, the CID had confirmed.
The Dubai connection
Perhaps the most striking element of the CID’s briefing was the alleged link between the laundering network and an international drug trafficking operation based in Dubai. Investigators say the fake-import scheme wasn’t simply about moving money out of Sri Lanka — it appears to have functioned as a channel for laundering proceeds tied to narcotics trafficking abroad.
Two key suspects connected to the Dubai end of the operation have already been extradited back to Sri Lanka with the assistance of INTERPOL. Both have since been remanded in custody as investigations continue.
What happens next
The CID’s Financial Crimes Investigation Division and its Proceeds of Crime Investigation Division are jointly pursuing the case, working to trace the full extent of the funds, identifying remaining suspects, and determining how deeply the banking sector’s compliance mechanisms were compromised or circumvented.
With 227 bank accounts and 13 financial institutions already in the frame, and a suspected link to organised international crime, the case is likely to face continued scrutiny in Parliament as the COPF presses for further disclosures on how the scheme went undetected for so long — and what safeguards, if any, are being put in place to prevent a repeat.
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