Deputy Minister of Industry and Entrepreneurship Development Chathuranga Abeysinghe has urged the public to treat investment schemes promising returns far above fixed-deposit rates over short periods as a warning sign, setting out a list of normal yields against which claims can be measured.

Institutions guaranteeing immediate high returns should be viewed with suspicion, Abeysinghe said in a social media post, because genuine returns from agriculture or business ventures typically take about a year to materialise, Hiru News reported.

Money in such schemes comes from a pyramid-style Ponzi structure, in which funds from new entrants pay dividends to existing members rather than being generated by real assets, he said — an arrangement that collapses over time.

He offered a second test: no company would offer outside investors unusually high profits if it could instead borrow from a bank at a lower rate and keep the earnings for itself.

The benchmarks

Abeysinghe set out prevailing returns across instruments:

He put typical annual profit margins at 5% to 15% in manufacturing and agriculture, and 10% to 20% in services, and said any operation promising gains beyond those benchmarks warranted constant scrutiny.

Context

The warning is general and names no company or scheme, and the report does not say whether it follows a specific complaint, an investigation, or action by a regulator. Abeysinghe’s portfolio covers industry and entrepreneurship rather than financial regulation; deposit-taking and securities offences fall to the Central Bank of Sri Lanka and the Securities and Exchange Commission, and the report does not indicate that either has opened proceedings.

The post as published carries the deputy minister’s own figures. LankaNewz has not independently verified the individual yield ranges, which will move with market rates, and no other verified newsroom had carried the remarks at the time of writing.

Sources