Ex-central bank director tried for Rp 18t corruption

Muninggar Sri Saraswati, The Jakarta Post, Jakarta

A former director of Bank Indonesia stood trial on Monday at the Central Jakarta District Court for allegedly abusing his authority by manipulating the central bank's liquidity support (BLBI) funds causing the state to suffer Rp 18.164 trillion (about US$180 million) in losses.

Paul Soetopo Tjokronegoro, 61, along with several other former Bank Indonesia directors, was accused of amassing wealth for himself and other parties during his term in 1997.

"The defendant had disbursed state funds to private banks that were not eligible to receive them," prosecutor Heru Chaeruddin told the court, presided over by Judge Rusydi As'ad.

The defendant, who looked calm during the hearing, is charged under Anticorruption Law No. 3/1971, which carries a maximum penalty of life imprisonment.

The defendant, along with other BI directors, was responsible for disbursing over Rp 18.164 trillion in state funds to 45 private banks.

According to central bank regulations, the private banks were not eligible to obtain the funds because the banks' accounts in the central bank were in deficit.

"The defendant should have imposed sanctions on the private banks but he did not," Heru said.

On Aug. 15, 1997, the defendant and other former BI directors, including Hendrobudiyanto, Heru Soepraptomo, Boediono, Haryono, and Mukhlis Rasyid, and central bank Governor J. Soedradjat Djiwandono decided that the central bank would disburse the state funds to banks that were facing liquidity problems during the monetary crisis.

Hendrobudiyanto is scheduled to be tried on Jan. 21, while Heru Soepraptomo will appear on Wednesday for the same case in the same court.

Paul, Hendrobudiyanto and Heru Soepraptomo lead a unit of the central bank to supervise 76 private banks that were having financial problems.

But they failed to stipulate clearly the requirements to obtain the funds that were later disbursed without proper procedures.

The court will resume on Jan. 23 to hear the response from Paul and his lawyers.

Paul is the first former government official to face trial linked to the manipulation of BLBI funds. He was detained from June 21, 2000 to Oct. 2, 2000, and was put under house arrest until Oct. 18 last year.

He is not currently under detention.

The former deputy director of Bank Aspac, Hendrawan Haryono, was acquitted from corruption charges in the first BLBI case in June last year. Instead, he was sentenced to one year in prison and was ordered to pay a Rp 500 million fine for violating banking laws.

Currently, several bankers are being tried for allegedly misusing the BLBI funds. Among them are Leonard Tanubrata, a former president of Bank Umum Nasional; Kaharuddin Ongko, a former deputy commissioner of the bank; Samadikun Hartono a former president of PT Bank Modern; and former officials Bank BHS Hendra Rahardja, Eko Edi Putranto and Sherny Konjongian.

Hendra, Eko and Sherny are tried in absentia as they are still at large.