Sat, 15 Nov 2003

BI to boost supervisory staff to curb scandals

Abdul Khalik and Fabiola Desy Unidjaja, The Jakarta Post, Jakarta

Bank Indonesia Governor Burhanuddin Abdullah said on Friday that the central bank would boost the number of its banking supervisory staff as part of efforts to help prevent banking scandals in the future.

He explained that because of the limited number of staff the central bank could not monitor the operation of branch offices of banks.

"Looking ahead, the central bank will intensify its supervisory work. We'll recruit more staff. Hopefully, there will be no more scandals," Burhanuddin said.

The plan came as authorities are investigating the Bank BNI scandal, which centers on the disbursement of export loans to a number of companies. The loans, amounting to Rp 1.7 trillion (US$202.4 million) were channeled by BNI's Kebayoran Baru branch office in South Jakarta, which did not make a proper credit assessment, as it turned out that the borrowers had submitted fake documents.

The bank, the country's second-largest in terms of assets, will suffer financial losses worth millions of dollars from this scandal.

There have now arisen calls for the government to dismiss the board of directors of the state-owned bank, although the scandal emerged from a branch office.

State Minister of State Enterprises Laksamana Sukardi confirmed on Friday that a shareholders meeting will be held next month to decide on a reshuffle at the top management of BNI.

He said the government would recruit new people to the board of directors, including from outside the bank.

Meanwhile, the police said they would summon every witness related to the BNI scandal including top politicians and their campaign managers mentioned in the mass media.

National Police chief of detectives Erwin Mappaseng said on Friday there was a possibility of summoning a campaign manager of one of the presidential candidates from a leading political party.

"Everyone will be questioned. It's just a question of priority as to whom we should call first," said Erwin.

Rumors have been rife that three presidential candidates from the Golkar Party allegedly received money from individuals implicated in the lending scandal.

Rumors also say that a campaign manager from one of the candidates received the money and used it to finance the construction of a house.

"We shall check the house after we've questioned the person," said Erwin.

He also said that the police had detained director of PT Binekatama Pasifik, Titik Pristiwanti, for further questioning. Binekatama is one of a number of companies that allegedly benefited from the BNI loans.

"Titik has been interrogated intensively here since yesterday and we issued a detention letter this morning," said Erwin.

Police can detain a suspect for 24 hours only. Police have to issue a letter so they can hold a suspect after the time limit.

Including Titik, police have managed to arrest nine of 12 suspects so far in the case. The suspects that have been held in police custody are BNI Kebayoran Baru branch head Kusadiyono, BNI Kebayoran Baru foreign customer service head Edi Santoso, Richard Kountul of PT Metrantara, Judi Basso of PT Bassomasindo, Aprilla Widharta of PT Pan Kipros, Adrian Lumowa of PT Usaha Esa Indonesia, Olla Agam of PT Gramarindo Mega Indonesia and Jeffry Basso of PT Tri Rannu Caraka.

Two other suspects still at large are an owner of Gramarindo Group, Maria Pauline Lumowa, and Adrian Waworuntu. Meanwhile, the operations manager of BNI Kebayoran Baru branch, Nirwan Ali, has been questioned but not held in police custody.