Ex-BI director sentenced to three years for graft

Tertiani ZB Simanjuntak, The Jakarta Post, Jakarta

After a trial lasting around one year, the Central Jakarta District Court sentenced on Tuesday former Bank Indonesia (BI) director Hendrobudiyanto to three years behind bars for abuse of power in disbursing liquidity support funds totaling Rp 9.8 trillion (US$1.1 billion).

Still free, Hendro, the former director for bank supervision, now 73 years old, refused to accept the verdict and said he would file an appeal with the high court, even though the sentence was more lenient than the six-years imprisonment sought by the prosecution.

The panel of judges in the district court found Hendro guilty of extending liquidity support loans to 18 indebted but ineligible banks, including the now-defunct BDNI and Bank Modern, in 1997 and 1998.

The judges found that Hendro had violated a presidential instruction issued on Dec. 3, 1997, which ordered the central bank to disburse the emergency funds only to healthy banks during the financial crisis.

"The defendant abused his powers at the time the country was suffering from the economic crisis, thus causing losses to the state and burdening the state budget," Presiding Judge Panusunan Harahap said when detailing the aspects that compounded Hendro's crime.

As to the mitigating factors, the judges pointed to the loyal service he had given as a civil servant for 44 years, his service as a legislator, and his advanced age.

Having considered these factors, the judges reduced the three years of imprisonment by the length of time he had been detained to date, and ordered him to pay Rp 20 million in fines or spend another two months in jail.

The judges did not require him to repay the losses that had been inflicted, as demanded by prosecutors, "because the facilities received by the banks were not in cash, but rather disbursed automatically through the bank clearing system. There is no proof that the defendant benefited from these facilities."

The court also ordered the prosecutors to return his three cars and private bank account books seized earlier as evidence.

Hendro argued that he was not guilty because the measures he and his colleagues took were designed to deal with the runs on the banks that were taking place at the time, and that it was the central bank's function to save depositors' funds.

A total of Rp 138.4 trillion, or 90 percent of the support funds extended to 48 ailing banks during the crisis, were misused by the bankers. Many of them have been brought to trial but most have been acquitted or received lenient punishments even though the state funds had never been recovered.

Besides Hendro, other suspects in the case included former Bank Indonesia directors Heru Supraptomo and Paul Sutopo. They will face the closing sessions of their trials in the Central Jakarta District Court on April 3 and 4 respectively.