House launches investigation into bank scandal

JAKARTA (JP): The House of Representatives launched on Monday a special investigation into the high-profile Bank Bali scandal.

The investigation team is expected to have special power to check bank accounts of suspects in the scandal.

House deputy chairman Hari Sabarno said that all of the five House factions approved the establishment of a 23-member special investigation team.

"All factions agree to exercise the investigation rights," he told reporters after a plenary session.

According to the constitution, the House has the right to conduct its own investigations of high-profile cases.

Hari said the team was expected to complete its investigation before the term of the current House expires on September 24.

The special investigation team is chaired by legislator Lili Asdjudiredja, who will be assisted by five deputies each representing the five House factions.

The Bank Bali scandal revolves around the controversial transfer of some US$80 million to PT Era Giat Prima (EGP) to help the bank recoup its interbank loans on closed-down banks.

The banking authorities have said that Bank Bali should not have used the services of EGP, a private company linked to President B.J. Habibie's loyalists, because the interbank loans are guaranteed through the government's blanket guarantee program.

Although the money has been returned, Habibie is facing pressure to take legal action against all of the people involved in the scandal, including influential figures.

There have been allegations that several ministers and other close aides of Habibie are involved in the scandal.

Legislator Ichsanuddin Noorsy, a member of the team, said that the investigation would include a probe into the possible involvement of high-ranking government officials.

He said the investigation team would check the bank accounts of people allegedly involved in the scandal.

"This should not be seen as a violation of bank rules because the constitution endows the House with the right to conduct its own investigations. We're investigating this case in the name of the people," he told reporters on the sidelines of the first meeting of the special team.

"I promise you that we'll get to the bottom of this," he added.

Ichsanuddin also said that he would suggest that the team summon Habibie for questioning, another constitutional right earlier relinquished by House leaders.

"There's no reason for the team not to summon Habibie," he said, pointing out that based on House decision No. X, Article 2d, Habibie could be summoned if the government bank restructuring program had inflicted serious losses on the state.

He said that the impact of the Bank Bali scandal was detrimental to the state in the form of plunging confidence and bank recapitalization costs.

Ichsanuddin said that the result of the investigation conducted by the House would be compared with the result of investigations conducted both by the government and independent auditor PricewaterhouseCoopers.

Ichsanuddin said that the Bank Bali scandal has become a major obstacle for Habibie's campaign for the November presidential election.

Habibie is also facing serious trouble over the separation of East Timor. The are growing calls for Habibie to resign because of fears that an independent East Timor could trigger the disintegration of other provinces. Habibie offered a referendum for East Timor last year without prior consultation with the military nor the country's highest legislative body.

Ichsanuddin also said that he would reveal evidence of bribes received by legislators in connection with the Bank Bali scandal.

"I will submit the data to the investigation team," he said.

Ichsanuddin was quoted by Kompas on Monday as saying that several legislators had been given Rp 50 million each to keep silent over the Bank Bali scandal.

Ichsanuddin was forced to clarify the report during the first working meeting of the investigation team on Monday.

"No members of this team are included on my list," he said, but added that he had yet to receive clarification from legislator Ekky Syahruddin.

Ekky admitted to receiving US$1,000 from the State Minister of the Empowerment of State Enterprises Tanri Abeng, but explained that it was in June 1998, and was a fee for the consultancy service provided by his firm PT Pan Asia System for the privatization process of state firms.

The House's special investigation team is scheduled to summon former Bank Bali president Rudy Ramli on Thursday. (rei)