Citibank ordered to pay Rp 8.87b for credit mistake
JAKARTA (JP): The West Jakarta District Court has ordered the Jakarta branch of Citibank N.A. to pay Rp 8.87 billion (US$806,303) in compensation for wrongfully refusing to clear checks written by businessman Hendra Tjoa.
Presiding judge H. Mohamad Arif said in his verdict on Tuesday that Rp 3.87 billion of the total was to compensate for material losses incurred from the refusal, while the other Rp 5 billion was for immaterial losses.
"Since the defendant was unable to prove that the formal requirements set for the opening of an account at the bank had not been met by Hendra, the refusal to clear his checks violated existing laws," Mohamad said.
Philip Jusuf, Hendra's lawyer, said during the lawsuit that Citibank had refused to clear a check written for Rp 12.38 million on Jan. 5 and another for Rp 10 million on Feb. 23, even though the bank had approved a maximum credit facility of Rp 153 million for the plaintiff.
Philip told The Jakarta Post on Thursday that the presiding judge had given 14 days to both the defendant and the plaintiff to appeal.
He said the bank, represented by Sunita, had decided to appeal and that Hendra was still considering the option.
"But principally we're against the verdict since it only met part of our demands," Philip said.
Hendra had demanded that Citibank pay Rp 10.36 billion for commercial losses and another Rp 100 billion for immaterial losses.
Moreover, the plaintiff had asked Citibank to make an apology through an advertisement in the major Indonesian dailies Kompas, Suara Pembaruan, Republika and Bisnis Indonesia for three consecutive days.
Philip said an apology was necessary to restore Hendra's image, which had been blemished due to the bank's refusal to clear his checks.
The panel of judges, however, rejected the apology demand on the grounds that the monetary compensation handed down in the verdict covered such immaterial losses.
None of Citibank's executives could not be reached for comment on the case. (hhr)