BRI tried to cover up scam: AGO
BRI tried to cover up scam: AGO
Abdul Khalik, The Jakarta Post, Jakarta
The Attorney General's Office (AGO) said on Thursday that the
management of state-owned Bank Rakyat Indonesia (BRI) tried to
keep the Rp 294 billion (US$34.5 million) loan fraud a secret
when prosecutors investigated the case in October.
AGO Public Relations head Kemas Yahya Rahman said following a
tip from the public, the Jakarta Prosecutor's Office (JPO)
investigated the case in October, but the BRI management had
tried to cover up the scam.
"The case was uncovered purely due to the JPO's investigation,
which was prompted by a report from the public. It was in no way
the result of an initiative taken by the BRI management. They had
even tried to obstruct the investigation. Only when we obtained
valid information from other sources and detained the three
branch heads, did we receive any cooperation from the BRI
management," said Kemas.
He stressed that the BRI management filed a formal report on
the scandal with the AGO after it became clear that it was
useless to cover up the matter.
The fraud began when the East Kalimantan Development Bank (BPD
Kalimantan) ordered in September the transfer of hundreds of
billions of rupiah to a deposit account at the BRI Senen branch,
Central Jakarta. On the same day, BPD Kalimantan ordered the
branch to move the money to an account belonging to PT Delta
Makmur Experindo. The branch head followed the order without
carrying out any procedural checks.
The transfer order, at a staggering Rp 115 billion plus US$3
million, turned out to be fictitious.
PT Delta Makmur Experindo is owned by Yudi Kartolo and
Hartono, who have been summoned twice by the prosecutor's office,
but they have not responded.
Yudi is believed to be an old hand in orchestrating banking
fraud, because of his alleged involvement in the Rp 1.1 trillion
fraud at Bank Negara Indonesia (BNI) in 2001.
"We can't arrest them yet, because we have only summoned them
twice. We must wait until the third summons has been delivered;
then we can arrest them if they don't appear. However, we will
keep on trying to locate them," said Kemas.
The scams at BRI Tanah Abang, West Jakarta, and at BRI Surya
Kencana, Bogor, were carried out by the same company, but used a
different method.
In them, PT Delta Makmur Experindo requested loans with time
deposits as collateral. The heads of both branches approved the
loans without verifying the collateral with the time deposit
holder.
The time deposit holder has denied that he permitted his
deposits to be used as collateral in the loans.
The lending scam at the Tanah Abang branch reached Rp 10
billion and at Surya Kencana, Rp 93.5 billion.
"The manner in which the scam was carried out shows not only
that the branch heads failed to do their jobs, but also that they
were key players in the fraud. We detained Deden Gumilar of the
Senen branch on Nov. 3, Asep Tarwan of Surya Kencana on Nov. 13
and Agus Riyanto of Tanah Abang on Nov. 20. They are still in
custody," said Kemas.
The AGO has questioned 20 witnesses and frozen the 29 accounts
into which the money has been channeled. The combined balance of
the accounts totals Rp 90 billion.
The fraud underscores the weak internal control in state-owned
banks.
This is the second fraud case reported in the last three
months, following the revelation of a massive Rp 1.7 trillion
lending scam at BNI in October.
Many banking analysts are worried that the two scandals are
only the tip of the iceberg in Indonesia's banking system.