Megawati defends 'release and discharge' policy<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
President Megawati Soekarnoputri defended a controversial
\npolicy of exonerating a number of former bank owners of past
\nbanking crimes, saying the move was a necessary part of efforts
\nimmediately to resolve the huge debts owed by the bankers to the
\nstate.<\/p>\n
In a year-end speech late on Tuesday, the President said that
\nwithout immediate action, the protracted debt problem could
\ntrigger difficulties in "other areas" and make these difficulties
\nmore complicated to resolve.<\/p>\n
She said the "release and discharge" policy was part of a
\nscheme agreed to with the International Monetary Fund and was in
\nline with guidelines established by the People's Consultative
\nAssembly and existing laws.<\/p>\n
"We can't let this problem drag on. That's why in December I
\nordered a thorough resolution, while at the same time providing
\nlegal guarantees for debtors who have settled their
\nobligations ... ," Megawati said.<\/p>\n
The government, in a recent Cabinet meeting, approved a much-
\ncriticized policy of the past administration of exonerating ex-
\nbank owners who have been judged cooperative in settling their
\ndebts to the state.<\/p>\n
A presidential directive on the release and discharge of the
\ncooperative former bank owners will be issued soon.<\/p>\n
The former bank owners, among the country's richest
\nbusinesspeople during the economic boom of the early 1990s,
\nbecame indebted to the state after their banks received some Rp
\n144.5 trillion (about US$16 billion) in government liquidity
\nloans to help the banks stay afloat in the wake of the late 1990s
\nfinancial crisis.<\/p>\n
A report from the Supreme Audit Agency said most of the
\nliquidity loans were misused by bank owners. Many of the
\nbusinessmen also have been accused of breaching the bank legal
\nlending limit by channeling most of their banks' money into
\naffiliated businesses, which contributed to the devastating
\nfinancial crisis.<\/p>\n
Four years ago, the Indonesian Bank Restructuring Agency,
\nwhich is mandated to collect the debts, announced a policy that
\nwould clear the indebted businessmen of their banking crimes if
\nthey fully repaid their debts.<\/p>\n
The policy has been strongly criticized by many parties who
\nsay it violates the people's sense of justice.<\/p>\n
After four years, none of the former bank owners have fully
\nrepaid their debts. Assets surrendered by the ex-bank owners have
\nproven insufficient to cover the debts in full, as many of the
\nassets have deteriorated in value.<\/p>\n
This will force tax payers to shoulder a greater burden in
\npaying the costs of the economic crisis.<\/p>\n
Several businesspeople have been identified as qualifying for
\nthe release and discharge status, including Sudwikatmono, Ibrahim
\nRisjad, The Nin King, Hendra Liem and Sudono Salim. The latter is
\nthe former owner of Bank BCA and the largest debtor.<\/p>\n
Under this new debt settlement program, those former bank
\nowners deemed uncooperative in settling their debts will face
\nlegal sanction.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/megawati-defends-release-and-discharge-policy-1447893297",
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