BRI boss probe over graft charges

JAKARTA (JP): President director of government-owned Bank Rakyat Indonesia (BRI) Djoko Santoso Moeljono was questioned by the Attorney General's Office on Thursday as a suspect in a Rp 572.2 billion ($76 million) loan scandal, Antara reported.

There was no explanation from the Attorney General's Office, but Djoko's lawyer Sulistiyo confirmed that his client had signed a dossier drawn up from the questioning session that lasted more than five hours, the news agency said.

He signed in his capacity as a suspect, the lawyer said.

The investigation, conducted by attorneys from the Intelligence Operation Center and the Special Crime Division, centered on a series of BRI loans that Djoko had reportedly approved for businessman The Nin King, the owner of the widely diversified Argo Manunggal group.

BRI is one of seven state banks currently being restructured because of massive overlending practices in the past.

Unlike three other state banks, BRI will be retained but it will undergo massive downsizing to focus on lending to small enterprises and would hand over its large corporate clients to the newly established Bank Mandiri.

Djoko's investigation followed a report filed by the Movement of Citizens Concerned with State Wealth (Gempita) to the Attorney General's Office alleging irregularities in BRI's lending practices.

Gempita questioned Djoko's decision in approving loans to companies under the Argo Manunggal group although they were performing poorly, according to Antara.

They include loans amounting to Rp 99.1 billion to PT Karawang Utama Tekstil, Rp 66.4 billion to PT Surya Pratama, Rp 57.5 billion to PT Maligi Spinning Mills, Rp 9.2 billion to PT Multi Sweeten Industries and hundreds of billions of rupiah to Argo Manunggal's real estate unit.

The credits for Karawang Utama, Surya Karya Pratama and Maligi turned bad in spite of efforts by BRI to rescue them. The credits to the real estate sector had also been disbursed but the project was not carried out.

Gempita also claimed dubious practices in BRI's US$50 million loan to PT Mulia Griya Indah, a unit of the Mulia Group, for the development of the Taman Anggrek II housing project. It is not immediately clear however whether the Djoko investigation also covered the loans to the Mulia Group.

In response to Gempita's allegations, Attorney General Andi Muhammad Ghalib had promised to look into the matter. On Thursday, he made good on his pledge. (emb)