Cenral Bank to boost measures to prevent scams<\/p>\n
The Jakarta Post , Jakarta<\/p>\n
Bank Indonesia will issue new rulings early next year to
\nprevent fraudulent banking practices by pushing banks to be more
\nprudent.<\/p>\n
Central bank governor Burhanuddin Abdullah said on Monday the
\nexact substance of the regulations was still being discussed and
\nlikely would be made public in mid-January.<\/p>\n
\"But the rulings will basically center on efforts to improve
\nthe banks' conditions, especially their compliance with prudent
\nbanking practices,\" Burhanuddin said.<\/p>\n
Strengthening banks' internal supervisory controls, improving
\nthe quality of bank loans and protecting consumers will be among
\nthe key ingredients of the new rulings, Burhanuddin said.<\/p>\n
All of these ingredients are essential for preventing banking
\nscams such as those at Bank Dagang Bali, Bank Asiatic and most
\nrecently Bank Global.<\/p>\n
Burhanuddin said these scandals tainted the image of the
\nindustry, which overall had made significant progress since the
\neconomic crisis.<\/p>\n
\"We hope we will not have to close down more banks next year
\nbecause of this. That is why we need these new rulings to help
\nmake the banks more prudent,\" he said.<\/p>\n
The central bank moved to close down Bank Dagang Bali and Bank
\nAsiatic earlier this year as their financial conditions worsened
\ndue to a number of irregularities.<\/p>\n
Bank Indonesia has put Bank Global under special surveillance
\nto prevent the bank's financial woes -- allegedly caused by
\nbanking irregularities -- from worsening.<\/p>\n
Earlier this month, Bank Indonesia renewed its cooperation
\nagreement with the National Police and the Attorney General's
\nOffice to deal with banking scams.<\/p>\n
Under the deal, law enforcers will have greater authority to
\ncrack down on bad bankers.<\/p>\n
At present, the country's banking law stipulates a maximum
\npenalty of 15 years in prison and a Rp 500 million fine for bank
\nfraud.<\/p>\n
The central bank, however, has been criticized for responding
\ntoo slowly to indications of fraud.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/cenral-bank-to-boost-measures-to-prevent-scams-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}