Bank owner evades charges
The Jakarta Post, Jakarta
Police have halted investigation into Tong Muk Keung, the majority shareholder of the now defunct Asiatic Bank, in an alleged bank fraud and changed his status to witness.
National Police director I of Economic and Specific Crimes Division, Brig. Gen. Samuel Ismoko said on Thursday there was not enough evidence to implicate Tong in the case.
Ismoko said, despite the change in his status, Tong would have to report to the National Police Headquarters twice a week.
Tong was declared a suspect on April 8 and banned from traveling abroad thereafter. At that time, he was suspected of involvement in alleged lending frauds amounting to Rp 1.2 trillion (US$139 million) and involving the recently closed down Asiatic Bank and Bank Dagang Bali (BDB).
Bank Indonesia (BI) spokesman Rusli Simanjuntak said that although majority shareholders were not operational officials, there was strong suspicion that they had influence over the directors' decision-making, especially in credit approval for affiliated companies -- which later turned out to be fictitious.
According to BI, the alleged lending frauds occurred when BDB placed funds in Asiatic in the form of interbank loans and Negotiable Certificates of Deposit (NCD). These funds were later used as loan collateral by the son of BDB's majority stakeholder, I Gusti Made Oka, who is married to Tong's daughter.
The amount of loans provided exceeded the legal lending limit allowed by banking law of only 10 percent of its lending exposure. The loans accounted for 70 percent of the bank's total assets of Rp 1.7 trillion.
With acquittal of Tong, there are eight former shareholders, directors and managers of BDB and Bank Asia named suspects in the bank fraud.
Five of them -- FB Surendro (former president director) and Made Budiana (former fund marketing director) from Bank Asiatic, and I Gusti Ngurah Oka Budiana (former chief commissioner), I Gde Wibawa (former treasury official) and I Nengah Suwardhana (former Jakarta branch head) of BDB -- are being detained for the purpose of the investigation.