Agribusiness scam hits Lampung, Rp 300b lost

Agribusiness scam hits Lampung, Rp 300b lost

Oyos Saroso H.N., The Jakarta Post, Bandarlampung, Lampung

A huge scam similar to that involving private agribusiness
company PT Qurnia Subur Alam Raya (QSAR) in the West Java town of
Sukabumi has hit Lampung province.

More than 100 people in Lampung have complained of losing a
total of about Rp 300 billion which they had invested in private
agribusiness company PT Citrafarm Usaha Mandiri Bersama (CUMB).

Yet, investors appeared reluctant to take the scandal to the
local police and file charges against the company, which had
offered a profit-sharing scheme.

Ironically, most of them refused to be publicly identified as
investors of PT CUMB, which had occupied an office on Jl. Dr.
Susilo No. 58 in the provincial capital of Bandarlampung.

"You need not mention my name. But frankly speaking, the boss
of the company has fled with around Rp 300 billion in funds from
110 investors," an investor told The Jakarta Post.

The company appears to have gone bankrupt, as it recently
closed its offices.

A staff member at the office said it was no longer rented by
PT CUMB, and had not been for several weeks. "I don't know where
PT CUMB moved its office," he said.

A number of investors said they decided to invest in the
company because it promised them attractive shares in profit.

"I have heard the case is being handled by the Jakarta Police
as PT CUMB's headquarters is in Jakarta. That's why we didn't
report it to the Lampung police," said Budi, one of the
investors.

He admitted he was convinced by PT CUMB management to put
money into the company. "I received profit from the company just
once," he added.

CUMB director Franklin could not be reached for comments on
Thursday. Apparently, he is in Jakarta to resolve the scam and
had promised to return the investors' money, reported several of
its employees.

In a similar case last year, around 6,800 people lost about Rp
500 billion in a huge scam involving the now defunct PT QSAR.

The agribusiness company's director, Ramli Araby, is being
held by the local police, which has charged him with violating
Bank Law 10/1998, Article 46, for collecting public funds in bank
accounts without a permit. The maximum penalty for this violation
is five years in jail.

Ramli could also be charged under Criminal Code articles 378
and 372 on fraud, which carry a four-year sentence.

PT CUMB had planned to develop a chicken farm of laying
pullets and chickens for consumption on 22 hectares of land in
the village of Suka Damai Babatan in Katibung subdistrict,
southern Lampung.

However, the company went bankrupt after it had just started
the business on only four hectares of land.

A security guard at the husbandry site said PT CUMB had
stopped raising pullets and chickens several months ago.

"What still remains is a plantation of 8,000 gold teakwood
trees surrounding the husbandry site," he added.

Yulianingsih, a PT CUMB manager, said the company headquarters
in Jakarta had offered the cultivation of agricultural products
such as potatoes, chilies, tomatoes and apples on 67 hectares of
land in Sukabumi.

CUMB director Franklin had reportedly put in about Rp 4
billion in start-up capital to prepare the infrastructure of the
business, including the purchase of land and the office space
rental.

The investors provided between Rp 4 million and hundreds of
millions of rupiah each to join the obscure business with CUMB,
which had placed newspaper advertisements as a fund-raising
campaign targeting locals.

Based on the company's profit-sharing scheme, investors who
contributed between Rp 5 million and Rp 6 million would receive
up to 54 percent of the amounts annually.

Head of the Lampung trade and industry office Gustimigo said
his office did issue a business license for PT CUMB, but refused
to take responsibility for the debacle.

"It is in the authority of the police," he said.