Executives nabbed in loan case

The Attorney General's Office (AGO) has arrested three top officials of PT Cipta Graha Nusantara/Tahta Medan (CGN/TM) in connection with Rp 1 trillion (US$107 million) in non-performing loans owed to state-owned lender Bank Mandiri.

AGO spokesman RJ Soehandojo announced on Monday that the three suspects, identified as company commissioner, SA, a director, DI, and president director ED, were apprehended at 11 p.m. on Sunday at a hotel in Medan, North Sumatra.

CGN/TM is one of 24 companies that are believed to have received the loans. The state prosecutors have been investigating the Medan-based company along with local TV broadcasting company, PT Lativi Media Karya, PT Siak Zamrud Pusaka and a company identified only as PT APM/ATM.

"We arrested them before they were able to flee the country. We brought them here to Jakarta and now they are being questioned," Soehandojo said, adding that the three people would be detained later in the day.

He said the investigators had not yet informed him about the suspects' roles in the case, but had confirmed that they were responsible for loans obtained from Bank Mandiri amounting to up to Rp 160 billion.

The prosecutors also planned to question Bank Mandiri executives in connection with the case, which came to light after the Supreme Audit Agency (BPK) found irregularities in the bank's decision to extend large loans to the companies in question.

"Based on our investigations, the bank gave credit facilities to ineligible companies and the firms misused the funds instead," Soehandojo explained. -- JP