Debt collectors held, police vow to crush operations
Debt collectors held, police vow to crush operations
JAKARTA (JP): Police have arrested two debt collectors as part
of its bold campaign to stamp out all collection agencies
operating in the city.
City Police Chief Maj. Gen. Mochammad Hindarto told reporters
Saturday that police vowed to crack down on debt collecting
services as a follow up to the instruction of Chief of the
Jakarta's chapter of Bakorstanasda (the Agency for Coordinating
Supports for National Stability) Maj. Gen. Hendropriyono.
Hendro, who is also the Jakarta military commander, earlier
stated collection agencies had caused trouble and fear among the
public as debt collectors were inclined to use physical pressure
on debtors in an effort to retrieve the creditor's money. He
thereby called on the police to curtail the service.
Hindarto said until recently the police have had no legal
grounds to capture debt collectors since they received no
complaints from the public.
"We acted based on reports from the public," the two-star
general said.
Hindarto was speaking at the closing of the 46th Armed Forces
civic action in Tangerang.
Hindarto refused to identify the two suspects who were
arrested by police on Saturday, but sources at the city police
headquarters said the suspects were identified as Gustav and
Tobing.
The two suspects are now in police custody for interrogation.
Martin Winata, 39, who reported the suspects to police, told
reporters that Gustav and Tobing along with two friends, who are
still at large, were hired by Mrs. King Eng Eng, a resident of
Pluit, North Jakarta, to force him to repay his ex-wife's debt.
Martin's ex-wife, Jessica Nalastia, 34, reportedly borrowed Rp
81 million (US$37,710) from Mrs. King in 1992 and thus far had
repaid only Rp 13 million ($6,052) of her loan.
Because Jessica had not paid off her loan the four suspects
confiscated Martin's car, an old Crown sedan, and ordered him to
also hand over a deed to his land as collateral.
On Wednesday, Martin reported the case to police, who later
captured two of the heavies Saturday morning at a food shop in
Bendungan Hilir, Central Jakarta.
Weak Law
Some lawyers say they fully support the ongoing anti-debt
collector campaign in principle as long as it is directed against
delinquent thugs who resort to physical and non-physical pressure
on the debtors.
Lawyer Hans Pardamean Siagian from the Edward, Hans, Murphy
and Partners Law Office and T. Gayus Lumbuun from the T. Gayus
Lumbuun & Associates Law Firm said there were many debt
collectors using lawful techniques in order to persuade the
debtors to repay their loans.
"When it is aimed at curtailing all collection agencies,
including the good ones, one will ask what the legal basis behind
the purge is? Is debt collecting illegal? Show me the law
forbidding the operation of debt collectors?" asked Hans.
In May, Hans spoke about collection agencies at a seminar
attended by bankers at the Shangri-La Hotel, Central Jakarta.
In his paper, Hans said that the operation of debt collecting
services is legal according to the Civil Code's chapter 1792
which permits someone to hire a third party to collect the money
he or she lent to other people on his or her behalf.
"Thus, anyone can be a debt collector," he said.
Hans also said in the paper he presented in the seminar that
the birth of collection agencies resulted from the bad loan
phenomenon which is rampant today and many resort to heavies
because the existing laws fail to protect the rights of
creditors.
"The legal process is complicated and time consuming. And
there is no certainty that creditors will get back their money.
Thus, collection agencies will remain as long as our law system
remains weak," Hans stated. (jsk)