Govt needs to send signal to all criminals: Economist

Govt needs to send signal to all criminals: Economist

Dadan Wijaksana, The Jakarta Post, Jakarta

While pushing ahead with plans to get debtors, considered as
cooperative, off criminal charges, the government should send a
strong signal that punishment would also prevail for
uncooperative ones, an economist said.

Chatib Basri of the University of Indonesia said he shared the
government's view that those who have been cooperative should be
awarded with a release and discharge (R&D) status.

However, he was quick to add, it should focus also on how to
deal with uncooperative debtors, instead of only boasting its
soft stance against cooperative ones.

"The government should not hesitate in showing signs that they
are committed to meting out tough punishment. This is important
to send a message that criminals may be punished in this
country," Chatib said on Friday.

"If not, crisis of morality will prevail. No one will be
afraid to commit crimes any longer as they know in the end, they
will not get punished."

His comments came as the government was in the final
preparation phase to give four former bank owners a release and
discharge status as they had been deemed relatively cooperative
in settling their debts with the government.

The four are Sudwikatmono (former owner of Bank Subentra and
Bank Surya) and Ibrahim Risyad (PT Risyad Salim International),
Hendra Liem (Bank Budi) and The Nin King (Bank Dana Utama and
Bank Baja).

They are among 35 debtors who in 1998 signed a debt settlement
scheme with the Indonesian Bank Restructuring Agency (IBRA), as a
way of repaying some Rp 138 trillion (US$15 billion at today's
rates) they owe to the state for misusing most of the liquidity
support loans given by the government during the crisis in the
late 1990s to help the banks stay afloat.

Another debtor, Salim (the founder of Bank BCA), will likely
also be added to that list, as he too had been deemed by IBRA as
cooperative.

The settlement scheme was separated into three parts, the
Master of Settlement and Acquisition Agreement (MSAA), Master of
Refinancing and Notes Issuance Agreements (MRNIA) and Deeds of
Indebtedness (APU).

While Sudwikatmono, Ibrahim and Salim are listed under MSAA,
The Nin King and Hendra Liem are included under APU.

The government said that Ibrahim Risyad had been cleared of
all obligations after he paid Rp 27 billion in cash in October,
on top of assets he had surrendered to IBRA, as part of his debt
settlements. Ibrahim's debts were a total of Rp 635 billion.

As for Sudwikatmono, with outstanding debt of around Rp 1.8
trillion, IBRA claimed he had surrendered four assets equal in
value to his debts.

IBRA chairman Syafruddin Temenggung has said that the status
was needed to be given to them to provide legal certainty and
show that the government was committed to abide by the agreed
upon schemes.

Another economist stressed the need for the government to
verify the value of the assets taken over to minimize the losses
on part of the government.

Umar Juoro, analyst at the Center for Information and
Development Studies (CIDES), earlier said that before issuing
such a status, a verification on the assets that had been
surrendered by debtors should be conducted first.

"The verification is needed to find out whether the
depreciation in value was really caused by the macroeconomic
situation -- as they have always claimed -- or because of
anything else such as back-door deals," Umar said, adding that
the Supreme Audit Agency (BPK) was the right institution for it.

Critics have said that the value of the assets surrendered by
the ex-bank owners had deteriorated so it was not sufficient to
cover the debts.