Businessmen get 15 years in bank scam

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.