AGO set to charge Mandiri directors as suspects

AGO set to charge Mandiri directors as suspects

The Jakarta Post, Jakarta

The Attorney General's Office (AGO) appears set to officially
name on Wednesday a number of directors of state-owned Bank
Mandiri as suspects in the alleged lending scam that has rocked
the bank, with all that remains to be done being the signing of
the relevant orders by Attorney General Abdul Rachman Saleh.

"It seems they are likely to be charged as suspects ... I
can't give their names yet. But for sure, there will be more than
one. I think you already know who they are," said Deputy Attorney
General for Special Crimes Hendarman Supandji on Tuesday after
meeting President Susilo Bambang Yudhoyono.

Abdul Rachman has said that his office would announce the
"good news" sometime this week as the President had instructed
the prosecutors to complete their investigations quickly so as to
show the government's seriousness in combating corruption.

The AGO opened an investigation into the country's largest
lender by assets last month after the Supreme Audit Agency (BPK)
released the results of its 2004 audit of the bank, which
revealed alleged lending irregularities worth over Rp 12 trillion
(US$1.26 billion).

Prosecutors have grilled Bank Mandiri president director
E.C.W. Neloe, vice president director I Wayan Pugeg, director for
corporate banking M. Sholeh Tasripan, director for consumer
banking Omar S. Anwar and senior finance and strategy officer
Keat Lee, but none have been detained to date.

The AGO has, however, arrested a number of officers from four
companies that allegedly obtained loans as part of the suspected
scam.

Hendarman said that the Bank Mandiri directors and officials
who would be named suspects appeared to have intentionally
flouted prudential banking principles when extended loans to the
four companies.

The four companies, which collectively owe more than Rp 1
trillion to Bank Mandiri, are PT Siak Zamrud Pusaka, PT Citra
Graha Nusantara/Tahta Medan, PT Lativi Media Karya and PT Artha
Bhama Texindo/Artha Tri Mustika Texindo.

"Our investigations have revealed that there were intentional
efforts on the part of the suspects to abuse lending regulations,
thus inflicting losses on the state," said Hendarman, adding that
the investigation would be expanded to include other borrowers,
including those closely linked to top government officials.

Separately, State Minister for State Enterprises Sugiharto
pledged that the government would replace those executives of
state enterprises named as suspects in corruption cases by the
AGO.

"We will definitely replace them so as to facilitate the
investigations," he said.

The state minister's office is planning a major reshuffling of
the directors and commissioners of a number of state enterprises,
including Bank Mandiri, later this month.

Bank Mandiri is scheduled to hold its annual shareholders'
meeting on May 16, with one of the items on the agenda being a
management shake-up following the disclosures surrounding the
alleged lending scam.

Sugiharto said the management reshuffle would be conducted
fairly and would not be influenced by politics.

"The President has ordered me to insulate these enterprises
from politics. If there are replacements to be made, this will be
done through an accountable selection process that will put the
right men in the right places," he said.