Djoko tells court how he spent Bank Bali money

JAKARTA (JP): Businessman Djoko S. Tjandra, a defendant in the high-profile Bank Bali scandal, told the South Jakarta District Court that he used Rp 434 billion (US$47 million) of Rp 546 billion paid to PT Era Giat Prima (EGP) to recoup interbank loans for Bank Bali.

Djoko told the court that another party which used the questionable funds -- paid to PT EGP for recouping Rp 904 billion worth of interbank loans -- was PT Unggaran Sari Garment of the Texmaco Group, which borrowed Rp 112 billion.

"I borrowed the remaining Rp 434 billion as a personal loan from EGP, which was agreed upon by EGP's chief commissary Buntaran and EGP president director Setya Novanto," Djoko told the hearing, presided over by judge Soedarto.

Djoko is a director at EGP.

Djoko said of the Rp 434 billion, he lent Rp 47.3 billion to businessman Arung Gauk Jarre, reportedly a close friend of former state minister of the empowerment of state enterprises Tanri Abeng.

At a previous hearing, Arung confirmed the loan from Djoko, but said he had no idea about the source of it.

Djoko said he also lent Rp 10 billion to Buntaran, Rp 2 billion to Setya Novanto and Rp 25.4 loan to PT Glora Raya Dian Abadi, a company which is linked to Arung.

"The remaining Rp 349.3 billion I used," Djoko said, without further explanation.

But Djoko said the entire Rp 546 billion was returned to the PT EGP account in Bank Bali.

He said he was informed on June 2 last year by then deputy director of Bank Bali Firman Soetjadja, that the Indonesian Bank Restructuring Agency (IBRA) had transferred Rp 904 billion to Bank Bali.

"The next day, I issued a memorandum to Bank Bali to transfer Rp 546 billion to PT EGP's account."

Djoko said the first transfer, worth Rp 404 billion, was made on June 3 last year and the remaining was transferred a week later.

The scandal originated from the failure of three private banks -- Bank BDNI, Bank Tiara and Bank Umum Nasional -- to repay a total of Rp 904 billion to Bank Bali, a debt which remained until the three were closed by the central bank in late 1998 due to poor financial records.

Bank Bali then asked the government for the loan disbursement as it was put under the restructure program.

The bank, however, agreed to pay Rp 546 billion to PT EGP as a commission to help recoup the interbank loans from the closed banks under the supervision of IBRA. (ylt)