BPK leader to help clarify alleged govt funds misuse

BPK leader to help clarify alleged govt funds misuse

Tony Hotland, The Jakarta Post, Jakarta

Head of the Supreme Audit Agency (BPK) Satrio "Billy" Budihardjo
Joedono confirmed that there were indeed transactions in the
alleged misuse of government funds (deposited in Account No. 502
at the central bank) that might constitute a criminal violation,
but he declined to reveal which ones.

"What's true is that there are two kinds of transactions here
-- transactions that are in violation of procedure and those that
may have violated the law -- but we're still analyzing it," Billy
told reporters on Friday.

Billy, however, declined to go into details about which
transactions the agency thought might have broken the law, saying
that an early disclosure would be inappropriate.

"We haven't given our opinion to the police about possible
transactions that might have broken the law. Of course, it would
be a bit odd if we told the press first," he said.

He added, however, that the police and the Attorney General's
Office (AGO) might have different opinions from BPK about the
classification of the transactions.

"They (police and attorney) have more expertise in determining
which acts can be considered criminal, and we have more auditing
expertise," said Billy.

He assured the public that BPK would be prepared to provide
information should the police and/or the AGO request further
assistance in their ongoing investigation.

An audit by BPK, issued in the middle of 2003, has drawn a
great deal of public attention after it said there could have
been some involvement of two prominent banking authorities, Bank
Indonesia (BI) and the Indonesian Bank Restructuring Agency
(IBRA), for allegedly misusing around Rp 20.9 trillion (US$2.4
billion) of government funds deposited in Account No. 502.

BI has been accused of misusing Rp 17.7 trillion, while IBRA
for the remainder. Both BI and IBRA have consistently denied the
accusation, saying that they had followed the rules and
stipulations in using the funds.

However, BI has admitted that about Rp 109.5 billion from said
funds should not have been withdrawn from the account. BI said
that it was due to differences in calendar day counts, currency
rates, interest rates and excessive discounts.

Account 502, in which some Rp 53.77 trillion was deposited in,
was opened in 1999 under the name of the then minister of
finance, Bambang Subianto, who later gave the authority to use it
for BI and IBRA.

The funds in the account were intended as blanket guarantee to
pay valid claims submitted by third parties toward closed banks
and to ensure banks' clients about the security of their savings
following the massive run on banks in 1998.

Both BI and IBRA are only holders of the account, and
therefore each withdrawal from the account must have been
approved by the minister of finance as the owner.

Police have declared four former officials of both
institutions as suspects in the graft case, namely BI's former
governor Sjahril Sabirin, and IBRA's I Gede Putu Ary Suta, Cacuk
Sudarijanto and Toto Budiarso.

The Police on Friday started questioning Sjahril, and the
process will resume next week on Wednesday.

Billy also said that BPK was already in the last stage of its
audit on IBRA's performance to find out whether the latter had
performed well in restructuring the banking sector in the
country.

IBRA was established in 1998 during the administration of
former president B.J. Habibie to clean up the banking sector,
which plunged it into a hectic financial crisis. The agency is
due to finish operating on Feb. 27 this year.