Bapepam finalizes six firms of breaching rules

Bapepam finalizes six firms of breaching rules

JAKARTA (JP): The Capital Market Supervisory Agency (Bapepam)
has imposed sanctions on six firms, four of which belong to major
business groups Bakrie, Tirtamas and Djajanti, for breaching
regulations.

The six firms are Bakrie's financing firm PT Bakrie Finance
Corporation; Tirtamas' cement producer PT Semen Cibinong;
Djajanti's fishery concerns PT Daya Guna Samudra and PT Bintuni
Minaraya; footwear manufacturer PT Super Mitory Utama; and
holding company PT Dharmala Sakti Sejahtera of the Dharmala
Group.

The agency said in a statement on Thursday it had imposed
administrative sanctions and fines of between Rp 61 million
(US$7,300) and Rp 1 billion on the six publicly listed companies.

The agency's statement said Bakrie Finance not only delivered
its financial report late, but also violated accounting
principles and misused capital raised during its right issue.

"We impose a penalty of Rp 61 million for reporting the
company's financial statement 61 days late," the statement said.

Bapepam also imposed an additional fine of Rp 500 million on
the company's boards of directors and commissioners for allowing
the issuance of misleading financial reports.

In addition, the capital market watchdog also ordered the
company to soon hold a public expose (presentation) to disclose
the use of the proceeds from the company's recent limited public
offering or rights issue.

Bapepam said that Bakrie Finance had diverted the use of Rp
475 billion raised during its right issue to purposes other than
those stipulated in the company's prospectus issued before the
limited share offering.

The agency also imposed a fine of Rp 1 billion on Semen
Cibinong's boards of directors for their failure to prove the
company's $250 million deposit as stated in its financial report.

"This carelessness affects the going concern of the company
and has caused its auditor to issue a disclaimer on the company's
financial report," Bappepam said.

Semen Cibinong has said it placed the money in two accounts in
the Far East Bank in the Cook Islands and at the Bank of Central
Pacific in Vanuatu.

But the company failed to convince Bapepam of the existence of
those deposits, as Semen Cibinong refused to publicly disclosed
the information.

"We order the company's board of directors to pay a penalty of
Rp 1 billion as a consequence of their negligence in carrying out
their duties," the statement said.

Furthermore, the agency required that Semen Cibinong publish
information about its $250 million deposits in two Indonesian
newspapers.

Super Mitory and Dharmala have to pay fines of Rp 86 million
and Rp 102 million respectively for a delay in their 1999
financial reports.

Bappepam also imposed an additional fine of Rp 500 million on
each of the two companies for conducting transactions involving
conflicts of interests.

According to Bapepam's statement, Super Mitory's board of
directors and commissioners must, in addition, pay a penalty of
Rp 250 million each.

The agency required that Super Mitory hold an independent
shareholders meeting to obtain approval of the questionable
transaction.

Djajanti's Daya Guna and Bintuni must both pay Rp 117 million
for the late submission of their 1999 financial reports.

Bappepam said the two companies also failed to disclose their
liabilities of $87.3 million to Bank Mandiri in their financial
reports, for which they must now pay Rp 128 million in fines
each.

In addition, Daya Guna and Bintuni's boards of directors and
commissioners are required to pay Rp 250 million as a penalty for
their negligence, the statement said.

Meanwhile, the Jakarta Stock Exchange (JSX) said on Friday it
would delist Super Mitory, Dharmala, Daya Guna and Bintuni on
Oct. 9.

JSX initially planned to delist the companies on Sept. 12, but
postponed the plan, pending Bappepam's investigation into the
four companies.

Bappepam also reported that insurance company PT Asuransi
Lippo E-net had paid their fines, totaling Rp 5.5 billion, to the
government.

Lippo E-Net announced earlier this year it had changed its
name to PT Asuransi Lippo E-Net from PT Asuransi Lippo Life,
because it was turning itself into an Internet and e-business
company.

Bappepam then launched a probe into Lippo on suspicions that
the company had mislead the public by the name change to profit
from investor craze for Internet stocks.(bkm)