Govt could be sued over R&D uproar
Govt could be sued over R&D uproar
Dadan Wijaksana, The Jakarta Post, Jakarta
As controversy over the government's plan to let cooperative
debtors off criminal charges continues, the Legal Aid Institute
(LBH) said on Monday that a class action against such a policy
might be considered an option.
LBH Chairman Munarman told The Jakarta Post that the action
could be a good way of protecting the interests of the public.
"As a breakthrough in the due process of the law, a class
action could be used to deal with this (problem)," Munarman said
on Monday, adding that the plan to let the debtors walk free from
criminal litigation was the latest example of a public lie
created by the government through its policies.
The Cabinet decided last week to free former bank owners
deemed cooperative in settling their debts to the state from past
banking crimes. A presidential directive for the "release and
discharge" (R&D) status of the debtors is currently being
prepared.
Among the ex-bank owners reportedly to be granted R&D status
are Sudono Salim (former owner of Bank BCA), Ibrahim Risyad (Bank
RSI), Sudwikatmono (Bank Subentra and Bank Surya), Hendra Liem
(Bank Budi International) and The Nin King (Bank Danahutama).
They are part of the total of 35 ex-bankers whose banks
received some Rp 144.5 trillion (about US$16 billion) of state-
funded liquidity support loans injected into the banking sector
during the late 1990s financial crisis.
Aside from breaking the legal lending limit ruling for banks,
which contributed to the banking crisis, many of the former bank
owners have been accused of misusing the loan facility by
channeling the funds to affiliated business groups or using them
for speculation against the rupiah.
The government has argued that the R&D policy is needed to
maintain legal certainty as it was part of the debt settlement
schemes signed by the former bank owners with the previous
government. Under the agreements, the debtors would settle the
debts via cash, assets or a combination of both.
But critics have said that most of the assets surrendered to
the state are rapidly decreasing in value, causing the government
to suffer huge losses if they are sold. This, in turn, would
force taxpayers to shoulder a much greater burden of the cost of
the banking crisis.
The Indonesian Bank Restructuring Agency (IBRA), for instance,
which has sold most of the assets surrendered by Salim, could
raise only some Rp 28 trillion, compared with Salim's debts of
more than Rp 52 trillion. Salim is the largest debtor.
What has made it worse, however, was a recent revelation that
the amount of debt established under the first agreement covered
the principle alone, not the interest.
Elsewhere, Munarman called on the House of Representatives to
jump to the public's defense, "as the House is a legitimate
institution set up to fight for the people it represents.
"And if the House requests LBH to file a class action against
any government policy to free debtors from criminal prosecution,
we'll be ready."
Earlier, economists also urged the government not to allow
debtors to walk free from criminal charges, in order to avoid a
backlash from the public in the future.