Vinayagamurthi Muralitharan alias Karuna formed the Tamil United People's Front in the eastern town of Batticaloa.
The Tamil United People's Front (TUPF) was formed with the objective of pressing for all Tamil issues, Muralitharan told reporters.
He accused the main Tamil party Tamil National Alliance (TNA) of not doing enough for the Tamils.
"It was us in the LTTE who created the TNA," he said.
Soon after leaving the LTTE he had formed Tamil Makkal Viduthalai Puligal (TMVP).
Later, when the civil war ended in 2009 with the defeat of the LTTE, he joined President Mahinda Rajapaksa in 2010 and became Vice President of the Sri Lanka Freedom Party (SLFP), the second largest national party.
Muralitharan was later made a deputy minister in the Rajapaksa government. After Rajapaksa's defeat, he left the SLFP.
Late last month, he appeared publicly with Rajapaksa again by attending the Joint Opposition rally.
He is currently on bail after having being remanded over misappropriation of state vehicles.
According to a 2011 report by the UN, about 40,000 Tamil civilians were killed in the final weeks of the civil war.
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