Govt rejects out-of-court conditions by closed bank

JAKARTA (JP): Minister of Finance Mar'ie Muhammad and Bank Indonesia Governor Soedradjat Djiwandono rejected through their lawyers yesterday an out-of-court settlement proposed by a businessman whose bank was closed by the government earlier this month.

Probosutedjo, who is President Soeharto's half-brother, is suing the finance minister and the central bank governor in the Jakarta Administrative Court over the closure of Bank Jakarta, along with 15 other ailing banks, on Nov. 1.

Probosutedjo said last week he would withdraw his lawsuit only if the government gave his bank a clean bill of health.

"The plaintiff's out-of-court settlement proposal cannot be accepted by the defendant because the government's decision (to close the ailing banks) has been carried out and cannot be revoked," the court's chief judge, Lintong Oloan Siahaan, said after presiding over a closed session between both sides at the court.

The defendants are willing to include Bank Jakarta officials in the team in charge of liquidating the bank's assets to reimburse its account holders.

The government's lawyer, A Zen Umar Purba, said Probosutedjo's proposal was rejected because it concerned the very reason it was closed.

"The decree cannot be annulled... as it has been applied in the public's interests," Purba said.

Probosutedjo last week laid out four conditions in his out- court-settlement proposal to the government.

One of the conditions was that Bank Jakarta be allowed to reimburse its account holders with its own funds. Another was that it be given the authority to collect money from its debtors.

Yesterday's rejection of the proposal by the government means the lawsuit will now go to court.

Siahaan has set up a panel of judges, chaired by himself, to try the case.

A court session next Wednesday will decide whether the lawsuit has met the procedural criteria to be tried.

Probosutedjo is one of two banks owners who filed suits against the government for the closure of their banks.

Probosutedjo filed his lawsuit on Nov. 7.

Bambang Trihatmodjo, Soeharto's second son, withdrew his lawsuit earlier this month citing "national interest" as the reason. (10)