Coconut oil, cancer and corruption in state institutions

by prof.TCG

Ever wondered why these scams are becoming an accepted norm? The latest being crude coconut oil imported to Sri Lanka by three main commodity importers. How did it slip customs, SLSI and the Health authorities? Where is the Consumer Affairs Authority (CAA) in this latest episode? The Consumer Affairs Authority Act No. 9 of 2003 in section 7 (a) draws reference to its responsibility “…To protect consumers against marketing of goods or the provision of services which are hazardous to life and property of consumers”.

Are these words only limited to print? The general public must hold the officers of these institutions accountable for negligence of fiduciary duty, and for wasting taxpayers’ money. Two of the institutions responsible for the negligence addressed through this article are managed by retired Major Generals who have proven beyond doubt that they are retired. For the record, all three institution heads and their Boards have been appointed by the President himself.

It is a commonly known fact that the so-called imported and packed coconut oil we consume is a mix of Palm Oil and bleached crude coconut oil mixed and sold as coconut oil – without impunity. The SLSI seems to be unaware of this reality even through various parties have accused manufacturers and importers of mixing palm oil and coconut oil for profiteering while the likes of PB and Artigala at the helm of the Finance ministry keep playing with tax structure for possible kickbacks from importers.

To make matters worse, instead of including the final product for testing, the SLSI and other government agencies seem to focus only on the ingredient level entering the country in any form. It is a proven fact that the so-called vegetable oil, sunflower oil etc. in the market is produced using palm oil and is marked with a fine letter disclaimer stating the core ingredient is “Palm Oil”.

So, what went wrong this time for these three racketeers / importers?

According to multiple reliable sources at the Consumer Affairs Authority, the imported stock of coconut oil was sampled by SLSI and the Department of Health at Customs, which is the usual due process. The sampling report came positive for highly cancerous Aflatoxin contaminant, and the Department of Customs, upon receiving the report, ordered the importers to reship the consignment to its place of origin. This however was a kneejerk response by the Department of Customs to save their skin since the stock had been released to the importers prior to receiving the test results. This to me is a total violation of basic import control policy framework and accepted standards as the stock should either be with Customs or should have been released to a bonded warehouse which is the internationally accepted norm. According to information received, at the time of inspection by CAA the consignment was in a general warehouse, with seals removed and unloaded from the containers and poured into large silo-type barrels, in violation of import control guidelines. An investigation is required to determine as to whether any guidelines were provided, and how the shipment was released.



The importers of Aflatoxin contaminated coconut oil are Edirisinghe Edible Oil (Pvt) Ltd, Ali Brothers (Pvt) Ltd, Katana Refineries (Pvt) Ltd. These three companies have submitted a second sample to SLSI and the results are due this week. The question to SLSI is why a second sample only to SLSI? Why not the Health ministry since the initial two samples drawn by these two government agencies show Aflatoxin contamination. How can SLSI accept a second sample from an unbonded warehouse notwithstanding the initial sample failure? The chairman of SLSI Nushad Perera and Director General Siddika Senaratne ought to be held responsible over accepting a second sample from seal-tampered, unauthorized warehouse. The entire process adopted by SLSI is questionable, especially the manner in which samples are accepted. Were Nushad Perera and Siddika Senaratne under pressure from the political authority, namely the ministers in charge Bandula Gunawardena & Lasantha Alagiyawanna? Or are they colluding with fraudulent importers for money? It is important to note that the SLSI is under H.E the President, while the Department of Customs is under the Prime Minister. It will be interesting to see what action has been initiated by the political authority to ensure the stock is not released to the market.

Information obtained from the CAA is that they have sampled four locations from the unbonded, unauthorized warehouses located in various parts of the country by these three scam-riddled importers and sent the samples to ITI for immediate testing. Further the CAA added that they have already collected 125 samples from the retail stores around the country that will be forwarded to ITI for testing. Seems a proactive measure taken by CAA to assure consumers that the stock in question has not found its way to the market. This determination is only possible post-test results and the CAA should inform the public immediately upon receiving the test results.

This also could very well be a ploy by the Palm Oil importers to further dent the consumer confidence placed on Coconut Oil and tilt the consumer towards Palm oil and other unhealthy substitute oils. This inevitably is a blow to the local coconut oil industry when a dangerous disease like cancer is associated with coconut oil by the self-styled unregulated consumer protection pundits who have mushroomed in the recent past that abundantly provide misinformation about Aflatoxin contaminated coconut oil possibly out there in the market. But no proof has been provided by these NGO type organizations so far and they seem to be working for vested interests knowingly or unknowingly and are contributing to the demise of the local coconut oil industry by associating it with cancer, be it imported or otherwise.

This whole fiasco bears the hallmarks of a possible campaign to shift the public into using substitute oils instead of coconut oil and the social media neoliberal clan along with the politically marginalized JVP and the bankrupt opposition have joined the bandwagon and seem to be shifting the epicenter of the problem to a political campaign against the government. The danger of the shifting is such that, once it finds a political agenda, the same will become scandal and fade away eventually with time.

I am yet to see the government proactively work to rectify the problem rather than get embroiled in a pissing contest with the opposition as the decisions made at a time like this will impact the coconut oil industry well into the future unless the decisions are shaped to address and rectify the issues surrounding the entire commodity import processes and critically and publicly address the deficiencies that exist at institutions such as SLSI, Customs and CAA, as this is just one imported commodity and these government agencies are also responsible for various other consumer imports and the possibility of the same process being applied is more or less guaranteed. Consumer confidence needs to be restored so that the average citizen in the country will trust the system and consume with confidence, and the government will effectively debunk the naysayers by rectifying the malpractices of government institutions like Customs, SLSI and CAA.