Gowa fingers BTN directors for graft
JAKARTA (JP): The non-governmental organization Government Watch (Gowa) filed a report at National Police Headquarters on Monday against current and former members of state Bank Tabungan Negara (BTN)'s board of directors.
The report accused two current and three former board members of graft. Gowa coordinator Farid Faqih said the scam, in which the five men allegedly used money from the bank's so-called "representation fund" in April 1999 to pay insurance premiums for their retirement plans, caused the state Rp 1.6 billion in losses.
"The use of the fund (to pay their personal insurance premiums) was unlawful because the fund was not meant for personal use," Farid said after filing the report, adding that Gowa had adequate evidence to back its allegation.
He distributed copies of the insurance premium payments and said the allegation was made based on Gowa's own investigation.
According to Farid, the representation fund was a budgeted fund allocated for miscellaneous expenses, such as commissions for associates who deposited large amounts of money in BTN.
He said that people who took money out of the fund were not required to supply the bank with documents showing what the money had been used for.
Farid said the disbursement of money from the fund was controlled by the bank's treasury division, then under the direction of the five men named in the report: Wahjudianto, Siswanto, Tito Soetalaksana, Pandansih and Badruszaman.
Farid said the five used money from the fund to pay their insurance premiums at PT Asuransi Jiwa BNI Jiwasraya.
Siswanto and Badruszaman are still members of BTN's board of directors, he added.
Farid explained his organization had contacted the bank to confirm the matter, and had received a letter from the bank's board of directors saying the money had been returned.
"But it is not about whether the money has been returned or not, but why they did it in the first place," he said.
Farid admitted the amount of money involved in this case was relatively small compared to similar cases, but it demonstrated the faults of the country's banking system.
The deputy director of corruption at National Police Headquarters, Sr. Supt. Indarto, who received Gowa's report, refused to comment on the case. But Farid said the police promised to study the case and would call Gowa sometime next week to discuss the matter.
Contacted by The Jakarta Post, a member of the bank's board of directors, Soeryanto, said Gowa's report was groundless since the insurance policies had been canceled and the money returned to the bank.
"The bank actually profited from the cancellation of the five insurance policies," Soeryanto said, claiming the bank received more than Rp 2 billion by canceling the policies.
He said keeping such "representation funds" was common practice at many banks. "Such funds are used, for example, to finance a golf tournament between the bank's executives and their colleagues from other companies as a promotion for the bank," Soeryanto said, adding it would be difficult to specify exactly how the money in such funds was used.
He, however, admitted such funds were not in keeping with the spirit of reform in the country, which demands greater transparency. "But such practices are still going on. That's the reality in our country."
Gowa was the first to disclose the Rp 35 billion scam at the State Logistics Agency, which involved President Abdurrahman Wahid's personal masseur, Soewondo, who is still at large. (08)