AGO to question Boediono as BI loan abuse
Tertiani ZB Simanjuntak, The Jakarta Post, Jakarta
Prosecutors are set to summon Minister of Finance Boediono in connection with the Bank Indonesia liquidity support (BLBI) scandal.
The first hints emerged from the Attorney General's Office here on Monday that Boediono would be summoned as a witness as he was one of the BI board of directors who approved the loan facilities to struggling banks between 1998 and 1999.
Deputy Attorney General for Special Crimes Haryadi Widyasa confirmed that his office was currently assessing Boediono's role in the scandal, which has already led to the prosecution of his former boss, former central bank governor Soedrajat Djiwandono, and three senior BI officials.
Soedrajat was declared a suspect in early May for allegedly abusing his power by extending the emergency loans to 48 now- defunct commercial banks.
Three fellow BI directors -- Heru Soepraptomo, Hendrobudiyanto and Paul Soetopo -- are already facing separate trials on charges of breaching banking regulations.
The three had led a unit responsible for supervising banks that ran into financial trouble during the peak of the economic crisis. They allegedly failed to stipulate clearly the requirements for obtaining the funds that were later disbursed without proper procedures being followed.
Deputy Attorney General Haryadi on Monday assured reporters that a "team of investigators will set a date for questioning Boediono again."
Speaking at a retirement party for Assistant Attorney General Soeparman, Haryadi said investigators would seek presidential approval to question the minister.
Boediono is known to be one of those who attended two key meetings of the board of directors on Aug. 15 and 20, 1997. Also present at the meetings were Soedrajat and the three other defendents.
The meetings decided that the central bank would disburse state funds to banks that were facing massive runs in order to restore public confidence.
During the monetary crisis, the government channeled a total of Rp 144.5 trillion in liquidity support funds to commercial banks.
The Supreme Audit Agency (BPK) later found that 95 percent of that amount, or Rp 138.4 trillion, had either been misused or been extended in violation of banking regulations.
The BPK laid the blame for the malfeasance on the poor oversight exercised by the central bank.
Haryadi claimed that only three of the 48 banks had not yet been thoroughly probed by investigators since they started their work in 2000.
But he said many of the investigations had now been suspended, pending final decisions by senior economic ministers grouped in the Financial Sector Policy Committee (KKSK) regarding debt settlement programs designed to recover state losses.