Ex-IBRA officials suspected of misusing funds
Abdul Khalik, The Jakarta Post, Jakarta
The National Police named on Tuesday a former Indonesian Bank Restructuring Agency (IBRA) chairman and his ex-deputy as suspects in the misuse of Rp 20.9 trillion (US$2.45 billion) from account no. 502.
"We have declared them suspects after finding sufficient evidence during the process of examining how they disbursed the funds to several troubled banks," National Police chief of detectives Comr. Gen. Erwin Mappaseng said.
The government funds in Bank Indonesia account no. 502 were used to cover the financial obligations of closed banks as part of the government's blanket guarantee program. The program was introduced in the late 1990s to help restore investor confidence in the country.
Erwin said the disbursement of the money failed to follow prevailing procedures.
He refused to reveal the names of the two high-profile suspects, saying the investigation was under way.
IBRA has been chaired by six men since 1998, namely Bambang Subianto (1998), Glenn Yusuf (1999-2000), Cacuk Sudaryanto (2000- 2001), Edwin Gerungan (2001), Ary Suta (2002) and Safruddin Tumenggung (2002-2003).
Erwin said the two suspects were believed to have misused Rp 400 billion of the total Rp 20.9 trillion and that the money should not have been given to several banks because the move was as not adequately authorized.
"For example, the funds were disbursed only with the approval of several staff officers after several meetings. The meetings were not representative enough to decide the disbursement of such huge amounts," he added.
He said the police had questioned more than 20 witnesses in the graft case and would summon many more in the coming weeks.
More suspects could be named by the police as the investigations continues, he said.
"We will charge them under the Anticorruption Law because they misused state funds," said Erwin.
National Police deputy chief of public relations Brig. Gen. Soenarko said earlier that two more officials from Bank Indonesia (BI) had been quizzed since Monday.
The two are BI director of banking regulations Nelson Tampubolon and BI head of liquidity support (BLBI) M. Ali Said Kasim.
The Supreme Audit Agency (BPK) alleged in August that Rp 20.9 trillion from Account No. 502 had been misused by BI and IBRA.
The BPK audit report was the result of an investigation undertaken at the request of the House of Representatives in mid- 2001, after most of the funds (approximately Rp 53.8 trillion) in the account had been used.
The audit request was made after the government had decided to set up a second account containing approximately Rp 40 trillion for the same purpose. The new account is known as account no. 509.
The audit report showed that of the Rp 20.9 trillion of allegedly abused funds, Rp 17.77 trillion had been used by BI and the remainder by IBRA.
Of the Rp 17.7 trillion funds used by BI, Rp 14.45 trillion was allegedly withdrawn in May 2000. BI regarded the funds as additional liquidity or BLBI on top of the Rp 144.5 trillion in funds injected into troubled banks by the central bank under the first phase of the BLBI program.
BI injected hundreds of trillions of rupiah into banks to prevent the banking sector from collapsing after being severely hit by the economic crisis in late 1997.
Both BI and IBRA have reiterated that there was no wrongdoing involved in the use of the funds and that everything had been done in line with the law.