“ Come Out of the Shell and Answer ”

– Keerthi Tennakoon Challenges the Central Bank –

“Don’t be deceived!” The Central Bank of Sri Lanka issued a two-sentence statement on May 25, 2026, in response to a press release issued by the Sri Lanka Human Rights Center. Nine months earlier, the Central Bank had also published a social media advertisement warning the public, “Don’t be deceived!”

Although 35 days have passed since what the “Free Lawyers” organization describes as a Treasury robbery, the Central Bank of Sri Lanka has yet to provide a proper explanation regarding the incident or the activities taking place under its supervision. In 2015, during the infamous Central Bank bond scam, it was Rajith Keerthi Tennakoon who exposed the fraud and filed legal action to prevent Arjuna Mahendran from being reappointed for a second term as Governor of the Central Bank.

In 2021, Rajith Keerthi Tennakoon also filed a case seeking to prevent Ajith Nivard Cabraal from being appointed as Governor of the Central Bank, though the Attorney General opposed it. In 2022, when Tennakoon warned about excessive money printing, the Central Bank again dismissed the claims saying, “Don’t be deceived.” Yet, within less than 100 days, Sri Lanka officially declared bankruptcy. Tennakoon also secured a court order preventing Cabraal from leaving the country.

The Central Bank has failed to provide direct and credible answers to the 15 key issues raised in our organization’s press release. Just as the President has avoided appearing before Parliament after the alleged USD 2.5 million incident, and the Treasury Secretary has avoided the media, the Central Bank too has failed to respond specifically to the matters raised.

1. “Don’t be deceived!”
Sri Lanka’s broad money supply (M2b), which stood at Rs. 14,439.1 billion in January 2025, expanded by Rs. 2,146.1 billion (Rs. 2.1 trillion) to Rs. 16,585.7 billion by March 2026. The effects of this expansion are now being felt across every sector of the economy.

2. “Don’t be deceived!”
Broad money supply (M2b) expanded by Rs. 1,653.3 billion during 2025 and by a further Rs. 610.7 billion between January and March 2026 — effectively amounting to money printing in technical terms.

3. “Don’t be deceived!”
The Central Bank purchases dollars from commercial banks using rupee notes stored in its vaults. This constitutes monetary creation — effectively printing money.

4. “Don’t be deceived!”
Sri Lanka’s economic crisis continues to generate alarming global headlines. Economist Steve Hanke, who made highly controversial statements about Sri Lanka’s inflation during the Gotabaya Rajapaksa administration, recently stated on X that:
“INFLATION STORY = MONEY SUPPLY STORY.”
During the 2021 crisis too, the Central Bank repeatedly claimed Steve Hanke’s assessments were wrong, yet it failed to prevent a national catastrophe.

5. “Don’t be deceived!”
Economic analyst Ranga Sirilal, who has published weekly reports on money printing for 15 years, recently posted on X:

“Rupee under pressure with Central Bank printing money: Rupee depreciated 7.2% against the US dollar so far this year to 353.17 rupees from last week’s 327.35 & last year’s 299.61. CBSL printed 309.4 billion rupees in March bringing first three months printing to Rs. 610.7 billion.”

The Central Bank has not responded to these claims.

6. “Don’t be deceived!”
Large quantities of newly printed currency notes have entered daily circulation. Currency in circulation stood at Rs. 1,351,312 million on January 1, 2025. By May 22, 2026, this had risen by Rs. 303,956 million to Rs. 1,655,268 million.
(The difference is clearly visible in Central Bank reports.)

7. “Don’t be deceived!”
The Governor of the Central Bank reportedly held two informal discussions with commercial bank heads and licensed money exchange operators, instructing them to maintain the dollar exchange rate within the Rs. 329–335 range.

8. “Don’t be deceived!”
The Central Bank of Sri Lanka has allegedly violated IMF conditions by unofficially imposing a controlled exchange rate of Rs. 330 per US dollar for interbank transactions.

9. “Don’t be deceived!”
The period granted to importers to repatriate foreign exchange earnings has reportedly been reduced from 90 days to 30 days.

10. “Don’t be deceived!”
The Central Bank has imposed a maximum limit of 70% on pawned gold valuations.

11. “Don’t be deceived!”
The vehicle import and trading sector has become chaotic.

12. “Don’t be deceived!”
As predicted on May 24, the Central Bank today (May 26) increased interest rates to 8.75%.

13. “Don’t be deceived!”
The government will soon have no alternative but to increase fuel prices as well.

14. “Don’t be deceived!”
Foreign reserves, which stood at USD 6,531 million in March 2025, increased only marginally to USD 6,759 million by the end of April 2026.
While the Central Bank managed to grow reserves by approximately USD 175 million per month during 2023–2024, reserves are now stagnating.

15. “Don’t be deceived!”
Sri Lanka’s outstanding central government debt, which stood at Rs. 28,240.22 billion in November 2024, had risen by Rs. 1,754.47 billion to Rs. 29,994.69 billion by the end of 2025.

Until the Central Bank provides a data-based analysis addressing these 15 issues, the public should not be misled by press releases and social media posts intended to conceal facts. The Central Bank’s first “Don’t be deceived!” campaign began nine months ago. Since then:

USD 2.5 million disappeared from an account established and operated under Central Bank supervision, with only USD 200 reportedly recovered so far.
Rs. 13 billion disappeared from NDB Bank, which operates under Central Bank supervision, and the funds were allegedly transferred overseas.
An overpayment of Rs. 656 million occurred in a foreign exchange transaction at People’s Bank.
A major fraud was reported at Sampath Bank’s Kandy branch.
Pyramid schemes continue unchecked.
Funds reportedly disappeared in SriLankan Airlines’ Chennai and Middle Eastern foreign exchange operations.
USD 625,000 paid by the Postal Department to the United States Postal Service (USPS) allegedly ended up in the hands of a third party.
The Road Development Authority (RDA) reportedly made duplicate payments.
Around 90,000 Aswesuma beneficiaries allegedly received duplicate or excess payments, which have still not been recovered.

Don’t be deceived..!

Rajith Keerthi Tennakoon
Executive Director, Sri Lanka Human Rights Center