The Government yesterday said that approximately $6.9 million remitted by Sri Lankan workers in Israel has been suspended due to legal proceedings involving remittance service provider Global Remit, dismissing claims that the funds were lost as a result of a cyberattack.
Addressing Parliament, Deputy Minister of Foreign Affairs and Foreign Employment Arun Hemachandra said reports suggesting that workers’ remittances had disappeared following a hacker attack were “completely false.” He stated that the funds had been frozen as a consequence of legal action initiated by Israeli authorities against Global Remit.
According to Hemachandra, around 5,100 Sri Lankan workers have been affected by the suspension. He said the Government is engaged in discussions at both banking and diplomatic levels to secure the release of the funds and resolve the issue.
The Deputy Minister also told Parliament that alternative remittance channels had already been introduced to ensure Sri Lankan workers in Israel could continue sending money to their families without interruption while efforts to recover the suspended funds continue.
The developments come as Global Remit Currency Services, an Israel-based international money transfer company, filed an urgent application before the Central District Court seeking temporary protection from creditors and the appointment of administrators after accumulating debts of approximately NIS 35 million, equivalent to about $12.4 million.
According to court filings, the company became insolvent after being barred from operating following a police investigation into suspected money laundering offences. Global Remit stated that much of the money seized by authorities belonged to customers, primarily foreign workers who used the company to transfer salaries to family members abroad.
Founded in 2012, Global Remit provided money transfer services to thousands of foreign workers in Israel. The company’s operating licence was suspended by Israel’s Capital Market Authority following developments in a police investigation that began about two years ago. The probe concerns allegations that the company and its managers committed offences under Israel’s Money Laundering Prohibition Law. Following the suspension, the Bank of Israel disconnected the company from the national payments system.
In its court application, Global Remit said it had been profitable and financially stable until the seizure of funds and suspension of its licences triggered an immediate liquidity crisis. The company argued that its collapse was not caused by operational losses but by the sudden halt of its activities.
The company estimated that it serves around 10,000 regular customers and an additional 9,000 occasional customers, many of whom are foreign workers employed in sectors such as agriculture, construction and hospitality. Customers originate from countries including Sri Lanka, Thailand, the Philippines and Nepal.
Global Remit has sought court approval for a restructuring arrangement under which its remittance operations for foreign workers would be transferred to Monox, a company within the 019 Group. The proposed plan also includes short-term financing and measures aimed at preserving the value of the company’s assets while protecting customer funds.
The company stated that tens of millions of shekels were seized from its accounts under court orders issued during the police investigation and that banks froze operations on several accounts between 9 and 11 May pending clarification regarding the confiscated funds. It further noted that the suspension of its operating licence has prevented it from carrying out new transactions.
Hemachandra said the Sri Lankan Government remains focused on resolving the issue affecting local workers while continuing broader efforts to strengthen the economy amid challenges linked to instability in the Middle East and climate-related pressures.
