Sri Lanka’s Stolen Asset Recovery Push Faces Legal and Political Roadblocks

Sri Lanka’s latest attempt to reclaim wealth illicitly moved overseas has triggered cautious optimism, but experts warn that the path ahead is riddled with legal, political, and bureaucratic hurdles. While international partners such as the Stolen Asset Recovery Initiative (StAR) have pledged technical support, the effectiveness of the campaign will ultimately depend on the country’s own governance reforms.

For years, stolen-asset recovery has remained a politically sensitive issue in Sri Lanka. Successive governments have announced high-profile investigations, but few have resulted in actual retrieval of funds. A lack of evidence, missing documentation, weak case-building, and deliberate obstruction by politically exposed persons (PEPs) have all contributed to repeated failures.

The arrival of StAR support is expected to boost credibility, but experts note that global assistance alone cannot compensate for domestic institutional weaknesses. Sri Lanka’s fragmented investigative system  with the Bribery Commission, Police, FIU, and AG’s Department working in silos  has historically slowed progress.

The proposed inter-agency task force may help unify operations, but its effectiveness will rely heavily on clear mandates and political insulation.

A more challenging barrier lies in international legal procedures. Many foreign jurisdictions, particularly in Europe and the Middle East, require extensive, meticulously documented proof linking assets to criminal conduct.

 Sri Lankan agencies have struggled to meet these evidentiary standards due to years of poor record-keeping, slow prosecutions, and incomplete asset declarations.

Compounding this problem is the lack of political continuity. Asset recovery initiatives often lose momentum when governments change. Investigations into politically sensitive figures are frequently abandoned, raising concerns about selective enforcement and undermining investor confidence.

Furthermore, domestic legislation itself requires strengthening. While the Proceeds of Crime Recovery Act is a step forward, lawyers argue that the Anti-Corruption Act and Assets and Liabilities Act must be updated to improve asset disclosure, protect whistleblowers, and enable faster freezing orders. Without these reforms, Sri Lanka may not be able to meet international cooperation requirements.

Despite these challenges, the current push comes at a time when the country urgently needs revenue. With public debt high and recovery from natural disasters ongoing, even partial asset repatriation could provide relief. Civil society organisations stress that genuine asset recovery must prioritize transparency, non-selective investigations, and consistent enforcement.

Whether Sri Lanka can finally break the cycle of unfulfilled promises remains to be seen. But with renewed global support and growing public demand for accountability, the country faces a crucial test in its fight against corruption.