Funds from BNI scam laundered in stock market

The Jakarta Post, Jakarta

Market watchdogs have traced "dirty money" worth Rp 11.4 billion (US$1.35 million), which has been laundered through the local stock market, a senior official said on Thursday.

Capital Market Supervisory Agency (Bapepam) chairman Herwidayatmo said his organization and the Financial Transaction and Report Analysis Center (PPATK) had discovered the money.

The funds were believed to have been embezzled from a Bank Negara Indonesia (BNI) Rp 1.7 trillion export credit facility and were allegedly stolen by a number of businessmen.

"Bapepam and PPATK have found indications some of the BNI funds are being laundered in the local stock market, in mutual funds and in bonds," Herwidayatmo said.

The funds were invested before the graft case was discovered in October last year, he said.

Bapepam and PPATK were now investigating several brokers and investment fund managers believed to be involved in the laundering. The agencies could not disclose their names to the public because it could jeopardize the investigations, he said.

PPATK had previously said the "dirty money" being laundered through the stock market might have been a key driver behind the recent surge in the stock market index.

PPATK is tasked with collecting, recording and analyzing all information reported by financial service providers -- banks and non-banks -- for suspicious transactions.

If their probes indicate criminal activity, their findings are forwarded to the police or Attorney General's office for further investigation.