Businessmen get 15 years in bank scam

Sari P. Setiogi and Urip Hudiono, Jakarta

Businessmen Yudi Kartolo and Hartono Tjahjadjadja joined on Thursday three former branch managers of state bank BRI in prison after the two were convicted in a US$21 million scandal involving the bank and received a prison sentence which took effect immediately.

The Central Jakarta District Court found Yudi and Hartono guilty of swindling Rp 180 billion (US$21.45 million) in state funds, and handed down a 15-year prison sentence to the two.

Earlier, Asep Tarwan, Deden Gumilar and Agus Riyanto, the former heads of the bank's Surya Kencana branch in Bogor, Segitiga Senen in Central Jakarta and Pasar Tanah Abang in Central Jakarta respectively were sentenced to between 12 and 17 years in prison for their role in the scam, which caused Rp 273 billion in losses to the state.

Meanwhile, in a hearing at the South Jakarta District Court, prosecutors sought a life sentence for Edi Santoso, the prime suspect in a scandal at the Kebayoran Baru branch of another state bank BNI last year. The scam resulted in Rp 1.7 trillion in state losses.

In the same hearing presided over by Judge Soedarto, the prosecution also sought a 17-year prison sentence and a Rp 300 million fine for the bank's former branch head, Kusadiyuwono.

Unlike other high-profile cases, the Central Jakarta District Court judges ordered both Yudi and Hartono to serve their prison terms directly, which are three years lighter than the sentence recommended by the prosecution.

Many public figures recently convicted by the court have remained free pending their appeals.

Yudi was absent from the hearing as he was receiving medical treatment in hospital.

"Both defendants will remain in prison and Yudi Kartolo is no longer allowed to be treated in the hospital," said Judge I Putu Widnya. Both Yudi and Hartono have been detained since early this year for investigation purposes, but Yudi was moved to the hospital in April.

Both were also fined Rp 1 billion (US$120,000) and ordered to repay the state Rp 55.2 billion each. The fine is equivalent to five months in prison, and if they fail to repay the state in one month then their assets would be seized and auctioned, said the judge.

Yudi and Hartono were the former commissioner and director of PT Delta Makmur Ekspresindo (DME) respectively, the company that was used as a vehicle to take money from the three BRI branches. Together with the banks' branch heads and their arrangers, they met several times to arrange the placement of credit in their accounts.

They were proven to have met at least four times with BRI branch heads before the placement of each deposit in the company's accounts at BRI.

Between July and September 2003, PT DME's accounts in the three BRI branches received at least Rp 273 billion as "loans with a high interest rate".

The money came from fixed deposit accounts, including those belonging to PT Jamsostek and Bank Pembangunan Daerah (BPD) of East Kalimantan.

The account holders denied they allowed the BRI branch heads to use their money.

The three former BRI branch heads were convicted of channeling the money as credit to PT DME, without complying with proper procedures.