Court begins trial of BI governor

Court begins trial of BI governor

JAKARTA (JP): The Central Jakarta District Court commenced the
trial of Bank Indonesia (Central Bank) governor Syahril Sabirin
on Wednesday regarding his alleged involvement in the
disbursement of Rp 904 billion (US$96.2 million) of Indonesian
Bank Restructuring Agency (IBRA) funds to Bank Bali.

Chief prosecutor Y.W. Mere said Syahril was responsible for
endorsing the disbursement of IBRA's money to Bank Bali.

He said Bank Indonesia and the Ministry of Finance had ruled
that the loans to Bank Bali were not covered by the government's
guarantee scheme.

"However, the defendant ordered one of his directors, Erman
Munzir, between February 1999 and June 1999 to disburse the money
to Bank Bali," Mere told the hearing, presided over by Judge
Soebardi.

He also said that the funds were extended for the purpose of
covering a loan that the now-defunct Bank BDNI had owed to Bank
Bali, but was unable to repay at the time it was taken over by
IBRA. It later became apparent that Rp 546 billion (US$58.8
million) of the money had been paid to factoring firm PT Era Giat
Prima (EGP) as a "commission" for helping secure the repayment of
loan installments.

"His action caused not only financial losses to the state, but
also undermined public trust in the country's banking system," he
said.

The prosecutor said Syahril had violated Article 1 of the 1971
law on corruption prohibiting the enrichment of oneself or others
at the expense of the state. The Article carries a maximum
punishment of a life prison sentence.

He also accused the defendant of having violated Article 55 of
the Criminal Code for abusing authority and conspiring with
others to commit a crime.

In response to the prosecutors' indictment, Judge Soebardi
granted defendant Syahril permission to read out his personal
statement contesting the indictment, despite the prosecutors'
protests.

"I have never imagined being seated as a defendant, nor as a
witness in this courtroom. Since my childhood I have always been
careful in making decisions and taking steps so that I would not
do anything wrong.

"But, this trial is a reality that I have to go through as a
way to prove that I've done no wrong," Syahril said while reading
out his personal statement.

He said the indictment was groundless as it had been prepared
by the prosecutors upon speculative assumptions.

The defendant said Bank Indonesia issued the letter ordering
the disbursement of the funds after receiving verification of
Bank Bali's financial condition from IBRA. Furthermore, the
verification, which was required to cover BDNI's loan as claimed
by Bank Bali, would no longer be held by Bank Indonesia as BDNI
has since been taken over by IBRA.

A team of seven lawyers, led by Muhammad Assegaf also read out
their defense statement against the prosecutors' accusations.

Assegaf said the case was not a pure legal matter as it has
arisen from President Abdurrahman Wahid's political motives to
terminate Syahril as the central bank governor.

"Based on a recorded conversation between Syahril Sabirin and
Attorney General Marzuki Darusman, it's obvious that the
President had pressured the Attorney General to force Syahril to
step down," he said.

"This trial is a consequence of Syahril's rejection of the
President's wishes," Assegaf told reporters after the hearing.

The prosecutors have also named former Bank Bali director Rudy
Ramli, former Minister of Investment and State Enterprises
Development Tanri Abeng, businessmen Setya Novanto, Firman
Soetjahja and Irvan Gunardwi, and former Supreme Advisory Council
chairman A.A. Baramuli, as other suspects in the case.

Meanwhile, businessman Djoko S. Tjandra and former IBRA deputy
chairman Pande Nasorahona Lubis were acquitted of all charges
related to the Bank Bali scandal in August and November last
year.

The case drew public attention when it was learned that EGP
was owned by people closely connected with a small group in the
Golkar Party who were responsible for the reelection of then
president B.J. Habibie, who eventually lost his bid to remain in
power in October 1999.

Syahril, who has been detained by the Attorney General's
Office for over five months, was installed by then president
Soeharto as Bank Indonesia's governor in February 1998, replacing
Soedradjad Djiwandono, who is also being questioned at the Office
for his alleged involvement in the Government Liquidity Support
Fund (BLBI) case.

Syahril was reappointed by Habibie when Bank Indonesia became
an independent central bank.

President Abdurrahman Wahid has been demanding the resignation
of Syahril since he took over the country's leadership late last
year. Syahril has continued to disregard Abdurrahman's demands.

Presiding Judge Soebardi adjourned the hearing until next
Wednesday, when the court will hear the prosecutors' counter
statement against the defendant's personal statement and the
defense lawyers' statement. (01)