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Lycamobile faces winding-up petition over £51m VAT dispute amid financial struggles and scrutiny

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The Guardian: Lycamobile, a telecoms company that has given more than £2m to the Conservative party, has been issued with a winding-up petition by HM Revenue and Customs, amid a long-running VAT dispute.

The company, founded by businessman Allirajah Subaskaran in 2006, sells pay-as-you-go sim cards that are popular with low-paid workers wanting to make cheap phone calls to family overseas, as well as in the UK.

While the company generated revenues of more than £145m in 2022, it is now loss-making. Its accounts have repeatedly been filed late and have at times confounded its own auditors.

Successive accounting firms have raised concerns about the opacity of Lycamobile’s books, while the company has also been locked in an eight-year tussle with HMRC over its treatment of VAT on phone “bundles” sold to customers over seven years.

The amount in dispute is £51m, according to a tax tribunal that ruled in favour of HMRC last month. In accounts filed earlier this year, Lycamobile estimated the potential cost to the company at £99m.

A winding-up petition is a formal legal process that creditors can use against a company that owes them money and is unable to pay its debts. HMRC regularly issues such petitions, which can result in assets being forcibly sold, against companies that have not paid their tax bill.

HMRC issued the winding-up petition against Lycamobile UK Ltd on Monday, according to a court filing seen by the Guardian and first reported by City AM. Identical petitions were served against sister companies Lycatel Services Ltd and, a week earlier, against Lycamoney Financial Services Ltd. All are ultimately owned by Subaskaran, a British-Sri Lankan entrepreneur who is Lycamobile’s founder and chair.

Lycamobile was one of the Tory party’s most generous donors between 2011 and 2016, giving more than £2.1m. It also supported Boris Johnson’s successful attempt to become London mayor.

It came under scrutiny in 2015 when an investigation by BuzzFeed revealed that Lycamobile employees were depositing rucksacks full of cash, some containing up to £250,000, at the Post Office.

There is no suggestion of any connection to the VAT dispute and Lycamobile said at the time that its cash deposits were part of “day-to-day” banking sanctioned by the Post Office.

Lycamobile has repeatedly filed its accounts late, putting it at risk of being struck off the corporate register. In 2016, the auditor KPMG said it was unable to account for £134m of assets, citing an arcane corporate structure including offshore entities.

The company’s latest auditor, PKF Littlejohn, said in June that it could not sign off Lycamobile’s accounts because it had “not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion”.

Those results, for the year to the end of December 2022, showed a £24m loss, compared with an £8m profit the previous year.

In the subsequent financial year, for which accounts are not yet available, the company suffered a malware attack that reportedly prevented customers making calls or topping up their accounts.

The Guardian has approached Lycamobile for comment.

HM Revenue and Customs said it could not comment due to rules regarding taxpayer confidentiality.

Sri Lankans advised to use overland routes to reach Israel amid airport shutdown

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June 16, Colombo (LNW): Sri Lankan nationals intending to travel to or from Israel have been urged to explore alternative transit options, as Tel Aviv’s Ben Gurion International Airport remains closed to commercial air traffic amidst the ongoing regional conflict.

The closure, prompted by escalating military tensions, has left many stranded or uncertain about their travel plans.

Nimal Bandara, Sri Lanka’s Ambassador in Israel, has confirmed that although direct air travel into the country is currently suspended, viable overland routes remain open via neighbouring states. Individuals can enter Israel through designated land crossings from Jordan and Egypt, provided they secure the necessary short-term visas from either country.

The southern border near the Israeli city of Eilat is amongst the active entry points, accessible through Jordan. Similarly, crossings from Egypt are being utilised, with the Cairo and Amman international airports now serving as the nearest viable hubs for those en route to Israel.

Speaking after a diplomatic briefing with fellow ambassadors in Tel Aviv, Ambassador Bandara relayed remarks from Israel’s Foreign Minister, Gideon Sa’ar, who acknowledged the uncertainty surrounding the reopening of Ben Gurion Airport. Whilst no date has been confirmed, he reportedly reassured attendees that movement into and out of Israel remains possible for those in urgent need—albeit by land.

This guidance comes against the backdrop of continued hostilities between Israel and Iran, which have significantly disrupted civilian life and international transit. The missile exchanges between the two countries have intensified, with no clear de-escalation on the horizon. The airspace over large swathes of Israel remains restricted due to security concerns, with the threat of further missile strikes prompting extended closures of air corridors.

Ambassador Bandara further encouraged Sri Lankan citizens to stay in close contact with the embassy and to avoid unofficial travel arrangements that might place them at risk. He also advised those travelling via Jordan or Egypt to be mindful of visa procedures, security protocols, and potential delays at border crossings.

Sarvajana Balaya sides with Opposition ahead of key Colombo Mayoral vote

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June 16, Colombo (LNW): The political alliance Sarvajana Balaya has formally pledged its support to the candidate put forward by the Opposition bloc in the contest to elect the next Mayor of Colombo, marking a significant shift in the capital’s municipal power struggle.

The decision, announced ahead of the inaugural sitting of the newly elected Colombo Municipal Council (CMC), could play a decisive role in today’s vote.

The executive committee of Sarvajana Balaya reached a unanimous agreement to oppose the mayoral nominee fielded by the National People’s Power (NPP), which had emerged as the largest single party following the local government elections held on 6 May, according to alliance leader MP Dilith Jayaweera.

Sources close to the alliance suggest that their backing is likely to benefit the Samagi Jana Balawegaya (SJB)-led coalition, which has been actively courting smaller parties and independents.

The inaugural session of the new CMC is set to convene this morning at 9:30 a.m. at the historic Town Hall premises. According to a gazette notification issued by Sarangika Jayasundara, Commissioner of the Western Province’s Local Government Department, the election of the Mayor and Deputy Mayor will be the first item on the agenda.

Landslide alerts remain in place across multiple districts amid persistent rainfall

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June 16, Colombo (LNW): Authorities have extended precautionary alerts for landslides across various parts of the island, as heavy and prolonged rainfall continues to raise the risk of ground instability.

The National Building Research Organisation (NBRO) confirmed that these warnings will remain active until 4:00 p.m. today (16).

Among the affected regions, a Level 2 warning—categorised as ‘Amber’ under the NBRO’s hazard classification system—has been issued for the Ratnapura and Ayagama Divisional Secretariat Divisions and adjacent areas within the Ratnapura District.

This elevated alert signifies an increased likelihood of landslides, slope failures, rock falls, and ground subsidence, prompting residents to remain vigilant and take precautionary measures.

Additionally, a broader Level 1 (Yellow) advisory, denoting early signs of potential landslide risk, has been declared for several other regions across the country. The Colombo District’s Padukka Division is currently under this warning, alongside Elpitiya in Galle and multiple zones in Kalutara, including Walallawita, Matugama, Bulathsinhala, Palindanuwara and Agalawatta.

Further inland, the Ganga Ihala Korale Division in Kandy, as well as the Ambagamuwa area in Nuwara Eliya, have also been flagged. In Kegalle, three divisions—Deraniyagala, Dehiowita, and Yatiyanthota—are under similar alert status.

Meanwhile, additional locations in Ratnapura District including Eheliyagoda, Kalawana, Pelmadulla, Nivithigala, Kuruwita, and Elapatha continue to be monitored under the Level 1 warning.

The NBRO urges residents in these zones to be especially cautious if they observe warning signs such as the appearance of cracks on walls or soil, leaning trees, unusual sounds from the ground, or changes in water flow patterns.

Local authorities, disaster response units, and community leaders have been advised to maintain close coordination to mitigate risk and ensure swift response if conditions deteriorate.

Residents are encouraged to follow updates through official NBRO channels and to prioritise safety over property should evacuation become necessary. The situation remains dynamic, with rainfall expected to continue intermittently in several regions throughout the day.

New Colombo Municipal Council Prepares for Crucial First Meeting Amid Power Struggle

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June 16, Colombo (LNW): The recently elected members of the Colombo Municipal Council are set to gather today (16) for their first formal sitting following last month’s local government elections, which have resulted in a fragmented council with no party holding an outright majority.

An official announcement confirming the meeting was issued by the Western Province’s Department of Local Government, with the Commissioner, Sarangika Jayasundara, gazetting the date and time.

Proceedings are scheduled to commence at 9:30 a.m. at the historic Town Hall premises, marking the beginning of what is likely to be a highly contested political chapter in the capital’s local governance.

The primary agenda for this inaugural session is the election of the Mayor and Deputy Mayor—two pivotal roles that will determine the administrative direction of the Colombo Municipal Council. With no party achieving a clear majority from the 117 seats available, negotiations and behind-the-scenes alliances have intensified in recent days, as parties seek to consolidate power.

The National People’s Power (NPP) emerged as the single largest group, having secured 48 seats. Close behind, the Samagi Jana Balawegaya (SJB) claimed 29 seats, whilst the United National Party (UNP) and the Sri Lanka Podujana Peramuna (SLPP) followed with 13 and 5 seats respectively. The Sri Lanka Muslim Congress garnered 4 seats, and Independent Group No. 03 secured 3 seats.

Several smaller factions and independent groups also hold sway in the council’s composition. Sarvajana Balaya and the United Peace Alliance each captured 2 seats. Independent Groups No. 04 and 05 also gained 2 seats apiece. Meanwhile, a range of lesser-known entities—including the United Republic Front, National People’s Party, National Freedom Front, Podujana United Front, and Democratic National Alliance—each managed to win a single seat, alongside Independent Groups No. 01 and 02.

With 59 seats required to command a working majority in the council, both the NPP and the SJB have claimed in recent days to have secured the support of enough allies to lead the administration.

The outcome of today’s vote for Mayor and Deputy Mayor will be an early indication of which coalition has succeeded in stitching together a governing bloc.

Trump reportedly opposed Israeli proposal to assassinate Iran’s Supreme Leader amid regional tensions

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June 16, World (LNW): Amid the rapidly escalating hostilities between Israel and Iran, it has emerged that former United States President Donald Trump reportedly turned down a proposal from Israeli leadership to target Iran’s Supreme Leader, Ayatollah Ali Khamenei, according to individuals familiar with the matter.

BBC citing its American wing CBS indicated that the proposal was floated during confidential discussions held after Israel initiated air strikes on Iranian territory.

President Trump is said to have advised against the action, reportedly telling then-Israeli Prime Minister Benjamin Netanyahu that carrying out such an assassination would be unwise and risk catastrophic fallout.

Despite the sensitive nature of the claim, Trump has not issued any public statements addressing the report.

When questioned about the matter during a televised appearance, Netanyahu declined to confirm or deny whether such a conversation with Trump had taken place. Instead, he dismissed reports about private discussions as often inaccurate, choosing to focus instead on broader strategic goals.

He reaffirmed Israel’s commitment to act decisively in its national interest, while offering no specific insight into the alleged plan.

A senior Israeli official, when approached for comment by international media, said Israel traditionally avoids targeting political heads of state. “Our strategic focus remains on dismantling military threats and curbing nuclear ambitions,” the official said. “Those making decisions in those areas should not be under any illusion of safety.”

Military operations between Israel and Iran have now entered their third consecutive day, with both sides launching strikes across strategic and urban locations. The cycle of aggression has left hundreds dead and injured, heightening fears that the confrontation could spiral into a broader regional conflict.

In an online statement released via his platform Truth Social, Trump urged both nations to reach a diplomatic solution, suggesting he could mediate an agreement as he claims to have done between India and Pakistan. “Iran and Israel should make a deal,” he posted, drawing parallels to previous tensions in South Asia that de-escalated during his term in office.

During remarks made prior to his departure for a G7 summit in Canada, Trump reiterated America’s commitment to supporting Israel, but declined to elaborate on whether he had requested a halt to Israeli air strikes.

He also maintained that the United States was not involved in Israel’s military actions against Iran, distancing Washington from the operation.

Simultaneously, efforts to revive nuclear negotiations between the US and Iran appear to have stalled. Talks scheduled to take place over the weekend were abruptly cancelled, according to Oman’s foreign ministry, which had been mediating discussions.

Iran reportedly informed its regional interlocutors that it had no intention of engaging in diplomacy while facing continued bombardment from Israel.

Tensions have further intensified following Trump’s statement on Saturday, in which he warned Tehran against retaliating against US interests. “Should Iran attack us in any form, the response will be swift and of a magnitude never before seen,” he declared.

Escalating conflict between Iran and Israel claims hundreds of civilian lives

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June 16, World (LNW): The ongoing confrontation between Iran and Israel has intensified dramatically over the past few days, leaving a trail of devastation in both countries and drawing international concern over the rapidly deteriorating humanitarian situation.

According to an official spokesperson for Iran’s Ministry of Health, more than 240 people have been killed and well over a thousand injured in a sustained wave of aerial bombardments attributed to Israeli forces. The bombardments, which reportedly began early Friday, struck multiple urban centres including the capital, Tehran.

Among the dead are numerous women and children, with officials claiming that the overwhelming majority of those affected are civilians. Over 1,200 individuals are said to be receiving hospital treatment, many with life-threatening injuries.

Iranian authorities say the air raids targeted a range of locations, including strategic military compounds and scientific research facilities. Reports also suggest that a number of high-ranking defence officials and nuclear specialists were killed in the initial wave of strikes. However, many of the attacks reportedly hit residential districts and public buildings, amplifying the civilian toll.

In retaliation, Iran has carried out a series of missile attacks directed at Israeli territory since Friday evening. Israeli emergency services have confirmed that at least two people were physically injured in the latest round of strikes launched on Sunday night, while dozens more required medical attention for shock and trauma.

Fires broke out in several locations following the impact of missile debris, with fire crews deployed to contain the blazes.

Sirens warning of incoming attacks were activated across wide areas of Israel, including Tel Aviv and parts of the occupied Golan Heights. Witnesses reported hearing loud explosions throughout the night. Israeli officials stated that more than 30 projectiles had been fired by Iranian forces, though many were intercepted mid-air by the country’s missile defence systems.

Fragments of intercepted missiles caused damage in the Haifa region, where several buildings and vehicles were set alight. Additional strikes in the south reportedly led to another large-scale fire, though no deaths have been confirmed as of yet on the Israeli side.

The ongoing hostilities have heightened fears of a broader regional escalation, with both nations trading blame and vowing to continue their military operations. Neither government has shown signs of de-escalation, and there is little indication that diplomatic channels are currently being pursued.

In response to the crisis, humanitarian agencies and international observers have urged all parties to prioritise civilian safety and adhere to international laws governing armed conflict.

Fairly heavy falls above 50 mm expected in multiple districts (June 16)

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June 16, Colombo (LNW): Showers will occur at times in Western, Sabaragamuwa, Central, Southern and North-western provinces, the Department of Meteorology said in its weather forecast today (16).

Fairly heavy falls above 50 mm are likely at some places in the Western and Sabaragamuwa provinces and in Nuwara-Eliya, Kandy, Galle and Matara districts.

A few showers may occur in the Northern province and in Anuradhapura district.

Strong winds of about (40-50) kmph can be expected at times over Western slopes of the central hills and in Northern, North-central, Western, Sabaragamuwa, Southern and North-western provinces and in Trincomalee district.
The general public is kindly requested to take adequate precautions to minimise damages caused by temporary localised strong winds.

Marine Weather:

Condition of Rain:
Showers will occur at several places in the sea areas off the coast extending from Puttalam to Hambantota via Colombo and Galle.

Winds:
Winds will be south-westerly.

wind speed will be (35-45) kmph and can increase up to (60-70) kmph at times in the sea areas off the coast extending from Puttalam to Mullaittivu via Mannar and Kankasanthurai.
Wind speed will be (30-40) kmph in the other sea areas around the island.
Wind speed can increase up to (50-55) kmph at times in the sea areas extending from Puttalam to Pottuvil via Colombo, Galle and Hambantota and from Mullaitivu to Vakarai via Trincomalee.

State of Sea:
The sea areas off the coast extending Puttalam to Mullaittivu via Mannar and Kankasanthurai will be very rough at times. Naval and fishing communities are advised not to venture into these sea areas, until further notice.

The sea areas off the coast extending from Puttalam to Pottuvil via Colombo, Galle and Hambantota and from Mullaitivu to Vakarai via Trincomalee will be rough at times.

The wave height may increase about (2.0 – 2.5) m in the sea areas off the coast extending from Mannar to Matara via Puttalam, Colombo and Galle (this is not for land area).

Naval and fishing communities are requested to be vigilant in this regard.

Indonesia Eyes Coconut, Tea Partnership with Sri Lanka to Boost Agricultural Value

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By: Staff Writer

June 15, Colombo (LNW): Indonesia’s Agriculture Minister, Andi Amran Sulaiman, has called for closer agricultural cooperation with Sri Lanka, particularly in the coconut sector, to unlock greater value from one of Indonesia’s most abundant commodities.

Speaking in Jakarta during a meeting with Indonesian Ambassador to Sri Lanka, Dewi Agustina Tobing, and Minister Sulaiman emphasized the importance of “downstreaming” in agriculture — the process of converting raw commodities into higher-value finished products. Coconut, he noted, is a top priority due to Indonesia’s vast natural supply and the growing global demand for processed coconut products.

“Downstreaming agriculture is a key government strategy to increase value and global competitiveness of local products,” Sulaiman said, underscoring President Joko Widodo’s directive to capitalize on raw material-rich sectors like coconut.

The minister highlighted shifting global consumption patterns, particularly in China, where consumers are turning from dairy to coconut-based alternatives such as coconut milk and virgin coconut oil (VCO). “This global shift is a golden opportunity for Indonesia, as European countries can’t grow coconuts,” he added.

Currently, Indonesia exports around two million tons of raw coconuts annually, valued at Rp20 trillion. However, Sulaiman estimates that turning coconuts into processed goods could raise their export value to between Rp40 trillion and Rp60 trillion — doubling or even tripling current figures.

To advance this vision, Sulaiman is actively seeking international cooperation, with Sri Lanka emerging as a key potential partner. During the meeting, Ambassador Tobing explained that Sri Lankan companies possess sophisticated technology for processing all parts of the coconut — including the husk and shell — into high-value products.

“Several Sri Lankan firms are interested in investing in Indonesia’s coconut processing industry. Their expertise could help us significantly upgrade our downstream capabilities,” Tobing said.

The two officials also explored possible collaboration in the tea sector. Sri Lanka, globally recognized for its tea industry, is reportedly keen to invest in Indonesia’s tea processing to help boost the value of local production.

“Sri Lankan companies are looking at Indonesia’s tea as a promising area. With the right processing methods, we could significantly raise the export value of our tea products,” Tobing noted.

In addition to coconut and tea, rice production was also discussed as a potential area of bilateral cooperation. Indonesia’s recent achievements in rice output have caught the attention of Sri Lankan officials. Tobing said Sri Lanka’s president and key ministers have shown strong interest in partnering with Indonesia on food security initiatives.

“We showcased Indonesia’s rice success to Sri Lanka’s leadership, and their response has been highly enthusiastic. They view Indonesia as a global food hub and want to deepen collaboration,” she added.

 As Indonesia pursues a more value-driven agricultural strategy, partnerships with countries like Sri Lanka — known for their agro-processing technologies — could play a crucial role in achieving economic transformation and improving export performance in the sector.

CRIB Charts Digital Future to Empower SMEs and Unbanked

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By: Staff Writer

June 15, Colombo (LNW): The Credit Information Bureau of Sri Lanka (CRIB), South Asia’s pioneering credit bureau, has unveiled a sweeping digital transformation roadmap aimed at enhancing financial inclusion and modernising the country’s credit ecosystem. 

Key initiatives include the rollout of a dynamic credit score for Small and Medium Enterprises (SMEs), the launch of innovative digital tools, and expansion into underserved, unbanked population segments.

CRIB plans to replace its 15-year-old legacy system with a new state-of-the-art digital credit bureau platform, in collaboration with a top-tier international credit bureau service provider. This transition, though complex and time-consuming, aims to transfer vast amounts of existing borrower data seamlessly, ensuring accuracy and minimal disruption for users.

A senior finance ministry official stated that the upgrade reflects CRIB’s shift from being merely a credit data repository to a fully digitised, proactive agency. Among the upcoming features is a new credit rating classification system, adding depth to the existing credit score reports currently offered.

As part of this transformation, CRIB introduced several digital tools at its annual event. These include a Portfolio Management platform, offering banks and finance companies real-time insights for managing large credit portfolios, and Credit Stat, a monthly analytical tool detailing institutional risk exposure and credit performance metrics. 

A CRIB mobile app is also under development to enhance consumer access.

According to current statistics, CRIB’s coverage includes 46.5% of Sri Lanka’s adult population — about 6.3 million individuals and over 212,000 businesses. 

Borrowers are now evaluated using a points-based credit scoring system, ranging from 250 to 900, with higher scores indicating lower credit risk. The bureau has also doubled its data volume in the past eight months by integrating gold loans, pawning, margin trading, and factoring into its database.

CRIB Director and General Manager Pushpika Jayasundera described 2024 as a “transformative year,” highlighting the agency’s evolution towards becoming a data-driven entity aligned with global standards. 

In July, CRIB is set to launch a Secure Transaction Registry, enabling SMEs and underbanked individuals to use movable assets as collateral—further supporting financial inclusion and credit accessibility.

CRIB is also strengthening ties with regional counterparts like India, Indonesia, the Philippines, and Taiwan to develop dynamic cross-border credit products and support migrant workers and foreign investors.

Central Bank Governor Dr. Nandalal Weerasinghe, the event’s Chief Guest, commended CRIB’s advancements in bridging information gaps between lenders and borrowers.

 He stressed the importance of empowering SMEs and improving the bankability of small-scale borrowers, noting that tools like those launched by CRIB can support evidence-based policy decisions and a broader digital financial ecosystem.

 Several financial institutions were also recognised for their excellence in data sharing with CRIB, underlining the growing importance of collaboration in Sri Lanka’s evolving financial landscape.

Sri Lanka Strengthens Apparel Industry through Social Compliance Push

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By: Staff Writer

June 15, Colombo (LNW): Sri Lanka’s apparel sector is gaining new momentum through a renewed focus on social compliance, highlighted by a recently concluded GTEX Workshop held in Colombo.

Organized by the International Trade Centre (ITC) with support from the Swiss Embassy, the full-day event at the Galle Face Hotel aimed to equip the country’s apparel exporters with the knowledge and tools needed to meet evolving global compliance standards.

The workshop was held under the Global Textiles and Clothing Programme (GTEX II), which is funded by Switzerland’s State Secretariat for Economic Affairs (SECO) and the Swedish International Development Cooperation Agency (SIDA), in partnership with the Export Development Board (EDB) and ITC.

Bringing together top apparel exporters, compliance professionals, and policymakers, the event focused on enhancing the industry’s understanding of global regulatory frameworks and offered actionable strategies to boost social compliance performance.

Key industry representatives, including ITC’s Head of Textiles Matthias Knappe, Swiss Embassy Deputy Head Olivier Praz, EDB Chairman Mangala Wijesinghe, and Joint Apparel Association Forum (JAAF) Secretary General Yohan Lawrence, emphasized the vital role of compliance in maintaining global market competitiveness.

Despite the global challenges and crises impacting Sri Lanka’s traditional markets, the country’s apparel exports recorded $4.7 billion in 2023, marking a 5% increase from the previous year — although still falling short of the $5.3 billion achieved in 2019.

The workshop featured an in-depth presentation on global compliance trends by ITC’s Social Compliance Lead Eranthi Premaratne, covering international frameworks such as the Social & Labor Convergence Program (SLCP), Worldwide Responsible Accredited Production (WRAP), and the Ethical Trading Initiative (ETI).

Case studies from industry leaders MAS Holdings and Brandix Apparel highlighted local success stories in integrating sustainability and social responsibility into business practices. An interactive session led by the Centre for Lean Excellence allowed participants to collaboratively address recurring factory-level compliance issues.

Participants also benefited from a hands-on training on compliance management systems, aimed at strengthening internal audit processes and supplier monitoring. ITC GTEX’s Navya Wijewickrema introduced the Global Textile Academy, which offers digital learning tools for continuous upskilling in compliance.

In their closing remarks, Knappe and GTEX SL National Project Coordinator Roshan Peries reaffirmed ITC’s ongoing support for Sri Lanka’s apparel exporters in meeting international standards while promoting inclusive growth and decent working conditions.

The event served as a crucial step toward reinforcing Sri Lanka’s reputation as a socially responsible and ethical manufacturing hub. To remain competitive, the country must invest in workforce upskilling, adopt advanced technologies including AI, and secure strategic free trade agreements. 

While regional rivals like Bangladesh and Vietnam are advancing rapidly, Sri Lanka retains a competitive edge due to its strong track record in ethical manufacturing, sustainability, and governance — attributes increasingly valued by global buyers.