AGO will probe $3b promissory scandal

The Jakarta Post, Jakarta

The Attorney General's Office (AGO) promised on Thursday to investigate a scandal surrounding the issue of 500 promissory notes worth Rp 30 trillion (approximately US$3 billion) involving a relative of former president Soeharto.

"Sure we will investigate it because it concerns state money," Attorney General's Office spokesman Muljohardjo told reporters when questioned about the government's response to the case.

The promissory notes affair resurfaced after a member of the House of Representatives, Ali As'ad from the National Awakening Party (PKB), urged the Attorney General's Office to probe it.

The notes were issued in 1985 by Soeharto's brother-in-law, Ibnu Hartomo, who was then deputy chief of the once powerful, but now defunct, National Defense and Security Council (Wanhankamnas) "on behalf of the Indonesian government".

A promissory note is a written promise to pay at a fixed or predetermined date a sum of money to an individual or bearer.

Troubles arose when bearers of the promissory notes in Europe and America found they were unable to cash them in because the Indonesian government did not recognize the notes' validity. Under Indonesian law, only the Central Bank (BI) and Minister of Finance have the authority to issue the notes.

In fact, Ibnu was named a suspect by police in 1998 in Jakarta but the case has never gone to court. The police alleged that Ibnu had falsified the 500 notes and sold them to a Syrian man named Hasan Zubaidi.

The Indonesia government is currently being sued by some of the bearers of the notes in a court in the American state of Arizona. Indonesian officials are worried that the country may have to pay out $3 billion.

Muljohardjo said that the Attorney General's Office, in cooperation with U.S. lawyers, was now acting as the Indonesian government's attorney in the trial.

"We will concentrate on the legal action (in Arizona) and after that we will investigate how the promissory notes were issued and circulated," Muljohardjo said, as quoted by Antara.

Legislator Ali As'ad said that the Attorney General should investigate the case and should not in any way cover it up simply because it involved a relative of the former president.

"Anyone involved should receive their due punishment," he said.