Rs. 13.6 Billion in Fraud Over a Decade ?
The financial impact of fraudulent transactions at NDB Bank has risen to Rs. 13.6 billion, with a final audit report pointing to serious governance failures and weak internal controls at the bank.
The findings came up before Parliament’s Committee on Public Finance (COPF), chaired by MP Dr. Harsha de Silva, which summoned officials of the Central Bank of Sri Lanka to examine the irregularities and the final audit report.
According to the committee, the audit, which covered April 1, 2016 to March 31, 2026, identified fraudulent transactions totalling Rs. 13,639,664,684. That is about Rs. 400 million more than the Rs. 13.2 billion NDB first disclosed on April 6, 2026, and Rs. 60 million higher than the figure announced on June 26 based on an interim audit report.
The bank’s September 29 disclosure breaks down the impact as follows: Rs. 1.5 billion before January 1, 2025, Rs. 9.6 billion during 2025, and Rs. 2.5 billion in the first quarter of 2026.
The final report confirmed that no customer accounts were affected. However, investigators found governance failures in the processing of Common Electronic Fund Transfer (CEFT) transactions, in user activity within the core banking system, and in the management of user credentials and access information. The report also flagged weaknesses in transaction monitoring, daily account reconciliation, financial compliance, internal auditing, branch network management and operational risk management.
During the meeting, the committee reviewed findings from investigations by the Sri Lanka Accounting and Auditing Standards Monitoring Board and Deloitte Touche Tohmatsu India LLP. Particular attention was paid to the failure of external auditors to detect irregularities in the bank’s financial statements, and lawmakers questioned the accountability of senior management on corporate governance and risk management.
MPs also raised concerns about the possible impact on public funds, noting that institutions representing public and state funds hold a significant share of NDB Bank’s shares.
The committee further reviewed LankaPay’s progress in developing a centralised fraud monitoring system, stressing the need to strengthen fraud detection within individual banks as well.
The final audit report recommends comprehensive improvements to NDB Bank’s internal controls, governance structures and operational procedures to prevent a repeat.
Deputy Ministers Chathuranga Abeysinghe, Dr. Kaushalya Ariyaratne and Nishantha Jayaweera, along with several MPs, attended the meeting.
