AGO investigating Mandiri loans extended to PT CGN

AGO investigating Mandiri loans extended to PT CGN

Eva C. Komandjaja and Urip Hudiono, The Jakarta Post, Jakarta

In the latest development in the Bank Mandiri alleged lending
scam, AGO spokesman R.J. Soehandojo told reporters on Wednesday
that prosecutors were now investigating loans extended to PT
Cipta Graha Nusantara (CGN).

He said that the bank lent some Rp 160 billion (US$17.20
million) as part of a bridging loan facility to PT CGN in 2002 to help
finance the acquisition of a company called PT Tahta Medan (TM).

But the bank later also extended an investment loan of $18.5
million, which prosecutors said had been made without conducting
a full credit analysis, or a comprehensive analysis of the legal
documents connected with the assets advanced in collateral.

"The second loan was also intended to repay part of the first
loan," Soehandojo added.

The AGO is investigating a lending scandal involving the
extending of more than Rp 12 trillion in loans to 28 companies.
For the past few weeks, prosecutors have been investigating four
companies, including CGN. Top officers of the four firms have
been named suspects, and some have been detained, including those
from CGN/TM.

The AGO on Tuesday also detained three former top officials of
Bank Mandiri.

Previously, prosecutors had also found irregularities in a
$4.7 million loan to the former owner of PT Siak Zamrud Pusaka,
which had already changed hands at the time the loan was
extended.

Nader Taher, the previous owner of the company, was detained
for obtaining the loan using his former company's name when
applying for the loan to Bank Mandiri. Nader once stood as a
gubernatorial candidate in Riau Islands province.

Meanwhile, in another twist to the scandal the Financial
Transaction and Report Analysis Center (PPATK) has found
indications that a member of the House of Representatives is
implicated.

PPATK chairman Yunus Husein told reporters on Wednesday that
his office had found that a House member -- whom he referred to
only by his initials, HM -- was among those who had received
questionable loans.

"The loan HM received is particularly questionable as it was
not used in accordance with the credit profile," he said.

Yunus further said that the PPATK's initial findings revealed
that HM had used some $2 million of the loan for active trading
in the stock of a British Virgin Islands-based information
technology (IT) firm.

"The firm itself was the winner of the tenders for IT systems
in three state-owned banks," he said.

In a hearing on Monday with the House legal affairs
commission, Yunus said that HM had received a total of Rp 20
billion and $3.4 million in loans from Bank Mandiri.

Separately, an antigraft team set up recently by President
Susilo Bambang Yudhoyono began its work of investigating
corruption in state institutions.

"They are tasked with probing possible corruption in state-
owned petroleum firm Pertamina, insurance firm Jamsostek, the
management of the Gelora Bung Karno sports complex and also the
State Secretariat itself," Soehandojo said without providing
further details.