BASL's Credibility Crisis: Bond Scam Donations, JICA Funds, and the Fight Over Judicial Independence
The Bar Association of Sri Lanka (BASL) has long positioned itself as the fearless guardian of judicial independence and the rule of law. It has been vocal, even "shouting and screaming," as some critics put it, in its opposition to proposed constitutional amendments to extend the retirement age of judges, framing the issue as a critical battle to protect the judiciary from executive overreach. However, a growing body of evidence and a series of scandals paint a troubling picture that calls into question the Association's moral authority and exposes a deep potential conflict of interest.
While the BASL fights to shape the future of the judiciary, it is simultaneously grappling with a past and present riddled with financial scandals. The association has been dogged by allegations of accepting "blood money" from the perpetrators of the infamous Treasury Bond scam, is under investigation for the alleged misappropriation of funds from the Japan International Cooperation Agency (JICA), and faces a crisis of confidence that has seen international funding dry up and senior officials resign in disgrace. In light of these scandals, the public is forced to ask a critical question: is the BASL’s aggressive campaign against the Chief Justice driven by a genuine concern for judicial independence, or is it a desperate attempt to remove a judge who could potentially oversee investigations into its own misconduct?
Tainted Donations from the Bond Scam
The Bar Association's association with the 2016 Treasury bond scam is a stain on its reputation. It is an established fact that in 2016, the BASL received a sum of Rs. 2.5 million from Perpetual Treasuries Limited (PTL), the primary dealer at the very center of the country's largest financial fraud . The company, owned by Arjun Aloysius and his father-in-law, former Central Bank Governor Arjuna Mahendran, was later found to have manipulated the bond market, costing the state billions of rupees.
The then-BASL President, U.R. de Silva, defended the transaction, stating it was a legitimate sponsorship for the 2016 Law Asia Conference. He claimed that at the time, Perpetual Treasuries was not under investigation . However, this defense is weak. The controversial bond auction was already a hot-button political issue as early as August 2015, and parliamentary oversight committees like the COPE were already probing the matter . The BASL, as the apex body of the legal profession, should have exercised far greater caution in accepting funds from a company so deeply embroiled in public controversy.
The acceptance of this money represents a profound lapse in ethical judgment. It is precisely the kind of quid-pro-quo relationship with corrupt financial entities that the legal profession is supposed to expose, not enable. The BASL's leadership at the time showed a willingness to accept tainted funds, arguably putting the financial needs of a conference over the integrity of the institution.
The JICA Fund Misappropriation Scandal: A Case of "Do as I Say, Not as I Do"
The more recent and explosive scandal involves the alleged misappropriation of funds from the Japan International Cooperation Agency (JICA). In a deeply ironic twist, the BASL, the very institution that purports to fight corruption, is now under a cloud of suspicion for corrupt practices related to an anti-corruption project.
JICA had provided a grant of Rs. 21 million to the BASL to conduct a study and workshops on anti-corruption as part of the "Data Collection Survey to Promote Transparent and Competitive Business Climate in Sri Lanka – Anti-Corruption Component" . It was a project specifically intended to support Sri Lanka's fight against bribery and corruption, a collaboration between Japanese experts and the Sri Lankan legal fraternity .
However, a storm erupted when it was revealed that a significant portion of the funds—up to Rs. 19 million—was transferred to the personal accounts of five BASL members who were part of the project team . The list of those who received the payments is itself a who's who of the BASL's upper echelons: Kaushalya Nawaratne (the then-President, a President's Counsel), Nalinda Indatissa (the then-Deputy President, a President's Counsel), Shavindra Fernando (a former Deputy President), Nuwan de Alwis, and Rashmi Indatissa (Nalinda Indatissa's niece) .
Senior members of the BASL Executive Committee demanded answers, questioning why the project had been undertaken and payments made without the approval of the Bar Council or its Executive Committee . The lack of transparency was staggering. The Bar Council was forced to appoint a five-member committee of senior President’s Counsel to investigate the allegations .
Investigation and Fallout: Resignations and International Concern
The investigative committee, led by Dr. Faisz Musthapha PC, found that then-President Kaushalya Nawaratne PC had "failed to act with transparency" regarding the contract and payments, violating the trust placed in him as President . The committee concluded that Nalinda Indatissa PC, as Deputy President, had also failed to exercise meaningful oversight over the process .
The fallout was swift and severe. The Bar Council, in a landmark decision, passed a resolution officially requesting Nawaratne to step down from his post . Following the pressure, Nawaratne resigned as BASL President in September 2024 . Nalinda Indatissa also resigned from his position as Deputy President . The Colombo Law Society, the largest and most elite branch association of the BASL, had already passed a resolution urging the office bearers to step down immediately .
The scandal also had serious international repercussions. Reports indicate that Commonwealth associations and several diplomatic missions have suspended or are reconsidering their funding to the BASL . Furthermore, there have been concerns raised about BASL officials facing visa issues to several countries, a clear sign that international partners view the association as a financial corruption risk . The Japanese Criminal Investigators are reportedly looking into the misuse of their aid, and the issue was even taken up by an MP in the Japanese Diet . A JICA representative stated that their contract and payments to BASL were completed based on their procurement rules, but washed their hands of what happened internally, stating, "We are not in a position to explain what happened at BASL regarding the contract with us" .
The "BMW Scandal" and a Culture of Opacity
Adding to the concerns is the so-called "BMW scandal," which suggests a broader pattern of questionable financial management within the BASL. These recurring scandals—the bond scam donations, the JICA misappropriation, and the BMW affair—point not to isolated incidents but to a systemic culture of opacity and a troubling lack of accountability within the association's leadership.
The Hypocrisy of the Retirement Age Debate
This brings us to the current political firestorm. The BASL has been at the forefront of opposing the government's move to amend the constitution to extend the retirement age of Supreme Court and Court of Appeal judges . The association’s leadership has framed this as an existential threat to judicial independence, "shouting" and "screaming" about the need to protect the judiciary from executive influence.
However, the timing and context of this campaign raise profound questions about the BASL's motives, particularly given its own leadership's entanglements with financial scandal. The proposed constitutional change, which would allow Chief Justice Jayantha Jayasuriya to remain in office beyond his current retirement date, has been publicly linked to the BASL’s campaign by some opposition politicians and members of the legal fraternity .
Critics, including some BASL members like Attorney Jagath Abeynayaka, have called out the association's silence on personal attacks directed at the Chief Justice . This selective outrage is highly suspect. When a sitting judge is personally attacked, the BASL has a duty to defend the judiciary, regardless of policy disagreements. The BASL's decision to remain silent on this front, even as its members actively participate in the political campaign, creates a "serious risk of creating the impression that the BASL tacitly approved of, or silently consented to, the remarks," as Abeynayaka pointed out in his letter .
Motives Under Scrutiny: Is the BASL Trying to Escape Its Own Sins?
This leads to the central, uncomfortable question the public must demand an answer to: Is the BASL’s war against the Chief Justice a genuine defense of judicial independence, or is it a desperate attempt to escape its own sins?
The BASL is under immense pressure. Its leadership has been embroiled in a major corruption scandal. It is under investigation by Japanese authorities and has been shunned by international partners. Its reputation is in tatters. In this context, a Chief Justice who has overseen a judiciary that is increasingly seen as a bulwark against corruption might represent a significant threat.
International Precedents for Legal Bodies in Corruption Scandals
The scenario of a prominent legal body facing a financial scandal and a subsequent crisis of authority is not without international precedent. Looking at similar cases of professional misconduct and corruption within legal circles helps contextualize the BASL's current predicament and the potential gravity of its situation.
The ICC Prosecutor Suspension (2026): In a striking example, the International Criminal Court's chief prosecutor, Karim Khan, was temporarily suspended from the British bar in 2026 after its oversight body found he engaged in "serious misconduct" . This involved allegations of an inappropriate relationship with a female staff member, leading to his formal removal from duties and the recommendation for his permanent ouster. This case illustrates that even the highest-ranking legal officials are subject to accountability and that the legal profession is capable of taking action against its own members in the face of serious misconduct. The suspension of an ICC prosecutor, a figure of immense international power, demonstrates the potential for a legal association to be both the accuser and the accused, and the severe professional consequences that can follow.
Bigmotor's Financial Collapse (2024): While not a legal association, the case of the Japanese used-car giant Bigmotor (BM) and its application for civil rehabilitation in December 2024 is a powerful cautionary tale of financial and operational failure . The company faced massive liabilities, estimated at up to 80 billion yen (approximately $540 million USD), due to fraudulent repair practices. This resulted in the collapse of the business and a scramble to compensate victims. This serves as a stark reminder of how systemic misconduct can lead to an institution's financial implosion and legal jeopardy. For the BASL, which has seen its international funding suspended and faces potential legal action, the specter of such a financial and reputational catastrophe is a very real threat.
A Legacy of Scandals Threatens the BASL's Role as a Guardian of Justice
The Bar Association of Sri Lanka finds itself at a critical crossroads. It is a body whose moral authority is being eroded by a staggering display of hypocrisy.
On the one hand, it claims to be the defender of judicial independence, protesting against the executive’s potential influence over the judiciary. On the other, it has displayed a shocking disregard for transparency and ethical conduct within its own ranks. It has accepted tainted funds, allegedly misappropriated donor money meant for anti-corruption, and is now under a cloud of international suspicion.
The BASL cannot credibly claim to be a guardian of justice while its own house is engulfed in scandal. The public has a right to demand answers. The association’s leadership must step forward and explain:
Why the money from Perpetual Treasuries was accepted and whether a full review of all past donations has been conducted.
What concrete steps are being taken to recover the misappropriated JICA funds and to ensure that those responsible are held fully accountable.
Why there is a lack of transparency regarding the investigations into the BMW scandal and other financial irregularities.
Most importantly, the public and the legal profession must question the BASL's true motives in the judicial retirement age debate. By making this a personal fight against the Chief Justice, the BASL risks being seen not as a defender of the constitution, but as a self-interested party seeking to protect its own leadership from accountability. The timing of their campaign, coinciding with their own legal and financial troubles, makes their cries for judicial independence ring hollow.
If the BASL wishes to regain its credibility, it must not only clean up its own internal affairs but also demonstrate unequivocally that its defense of the judiciary is not a shield for its own misconduct. The public must demand this. The future of the rule of law in Sri Lanka depends on the integrity of its defenders. If those defenders are compromised, then the very institution they seek to protect is also at risk.