The Securities and Exchange Commission (SEC) of Sri Lanka achieved a historic recovery of Rs207 million through enforcement actions in 2025, marking the highest amount in the agency’s 38-year existence. In a recent interview, SEC Chairman Hareendra Dissabandara, who took office in October 2024, revealed that the commission successfully convinced 45 companies that had applied to delist from the Colombo Stock Exchange to remain listed.
Dissabandara pointed out that the Rs188 million settlement related to a market manipulation case, which remains undisclosed in terms of the involved party’s identity, was the largest in SEC history. However, he clarified that this settlement was agreed upon by a previous commission and was not a decision he would have personally made. The chairman, who is also a finance and corporate governance professor at the University of Sri Jayewardenepura, has previously held positions at the SEC as director of the Capital Market Education and Training Division and as director-general.
Under the Securities and Exchange Commission of Sri Lanka Act No. 19 of 2021, Dissabandara returned to lead an organization with a complex history. The 2021 legislation provided the SEC with new powers, enabling it to address market misconduct through civil proceedings, impose administrative fines, and settle cases outside of court, among other capabilities. Notably, the SEC can now recover up to three times the profits made by offenders in successful settlements. In a landmark case in December 2025, the SEC utilized this authority to recover Rs188 million from a perpetrator who had profited Rs62.7 million.
Submit Your Press Release
Get your company news, announcements, launches, appointments and events in front of a wider audience.
Despite this record recovery, the SEC’s workload has decreased significantly, with investigations dropping from 62 in 2024 to 48 in 2025. Only seven of these investigations resulted in enforcement actions, compared to 36 the previous year. Similarly, the overall number of listed companies in Sri Lanka declined from 296 in 2021 to 285 in 2025. The market capitalization has also diminished from 36.7% of GDP in 2021 to 27% in 2025, with notable delistings including Nestlé Lanka and Expolanka Holdings.
Dissabandara emphasized the importance of institutional integrity, stating, “What matters is not whether a minister appoints you, but whether there is a process, a manual, a documented system that cannot be overridden by one person’s phone call.”
Regarding the Rs188 million settlement, which is regarded as a significant achievement for the commission, Dissabandara explained that the decision to settle was made prior to his tenure. He expressed his belief that criminal prosecution would have been a more effective deterrent, as it would carry significant penalties, including imprisonment. He underscored the importance of transparency, noting that the public remains unaware of the identity of the party involved in the settlement, an anonymity that was part of the agreement but not mandated by law.
Dissabandara expressed his intention to adopt a “name and shame” approach for future cases, advocating for transparency in the SEC’s enforcement actions. He noted that the agency has been settling cases regularly, although this information has not been widely known. He attributed the decline in the number of investigations to various factors, including improvements in surveillance through new systems that enhance the detection of misconduct.
Looking ahead, he stated that the SEC is committed to a rigorous process for investigating cases, ensuring that all cases are thoroughly examined by the Surveillance and Investigation Committee. He acknowledged the complexities involved in investigations, which can take years to resolve due to various delays encountered.
On the topic of the Compensation Fund, which currently holds Rs917 million, Dissabandara clarified that its purpose is to address broker insolvency and not to compensate victims of market manipulation. He noted that amending the fund’s purpose would require legislative action.
When discussing the market’s challenges, particularly the high number of companies seeking to delist, Dissabandara pointed to the uncertainty surrounding economic stability and the burdensome nature of compliance requirements. He stressed the need for market development and new financial instruments to enhance the attractiveness of the exchange for companies.
In response to inquiries about an ongoing investigation into a significant fraud case at NDB, Dissabandara detailed the SEC’s rigorous approach to ensure accountability and transparency. He highlighted the importance of internal controls and the need for clear answers from the bank’s management regarding the discrepancies found in their financial disclosures.
Lastly, when addressing the potential for political pressure in his role, Dissabandara stressed the importance of established processes and documented systems to maintain independence. He affirmed his commitment to ethical governance, stating that he would resign if pressured to act improperly.
