Dragon Bank's representative loses license
Dragon Bank's representative loses license
JAKARTA (JP): The Investment Coordinating Board (BKPM) has revoked the operational license of the representative office of the Vanuatu-based Dragon Bank International Limited in Indonesia for operating in unlicensed activities.
BKPM announced Saturday that all facilities given to the bank's representative office, such as permits to hire foreign workers and multiple exit/reentry permits for its staff, were also annulled.
The investment board did not specifically disclose the mistake of the bank's representative, but sources said that Dragon Bank's representative had operated as a bank instead of an investment firm as stipulated in the license issued by BKPM.
An executive of Dragon Bank, who refused to be identified, said that the bank's executives "warmly welcome" the investment board's decision to revoke the bank's operational permit.
"We highly respect the decision and we will obey all the existing rules that we should have followed," he told The Jakarta Post by phone on Saturday.
He agreed that Dragon Bank should have had an operational permit from the Ministry of Finance, with a recommendation from Bank Indonesia.
The controversial license given to Dragon Bank had been widely debated in the media, and speculations made as to the reason behind the issuance of the investment permit to the bank, which, according to existing regulations, is overseen by the Ministry of Finance.
The Ministry of Finance is in charge of licensing all companies involved in banking, financing, insurance and capital market activities, while BKPM is responsible for issuing investment permits in business sectors outside the financial and mining activities.
The bank's official earlier denied the allegation that the banks had violated the permit, saying that Dragon Bank's representative office was engaged in telecommunication projects in cooperation with a local company.
Yee Mei Mei, an executive of the bank's Indonesian representative office is currently engaged in a legal dispute with the branch office of Standard Chartered Bank.
Mei Mei, a Hong Kong national, filed a lawsuit against Standard Chartered Bank for allegedly blocking her account of around Rp 1 billion (US$45 million) without justification.
In the lawsuit, she claimed damages of $300 million to cover losses resulted from the freezing of her account. She claimed the funds would be used to finance activities of Bank Dragon's office here.
Standard Chartered Bank said that it froze the account on recommendation from Bank Indonesia.
Bank Indonesia Governor J. Soedradjad Djiwandono refused last week to comment on the central bank's role in the blocking of the account. (hen/bsr)