House promises Bank Bali investigation

JAKARTA (JP): The House of Representatives special investigation committee said on Wednesday it would push ahead with its own investigations to unravel the high-profile Bank Bali scandal despite publication of the PricewaterhouseCoopers (PwC) audit.

Head of House Commission IX for finance and banking Sukowalujo Mintohardjo said on Wednesday the committee would ensure that the case would be fully and satisfactorily resolved according to the laws.

"What's important is that the committee's investigation must end with legal action," Sukowalujo said.

The joint committee of House Commission IX and Commission II for legal affairs will commence on Thursday comprehensive investigations of the scandal. The committee expects to complete the inquiry by the middle of December.

The committee was initially set up to study the PwC report in order to determine whether to publish the document. But before the committee began its work, House Speaker Akbar Tandjung decided on Tuesday to publish the report following strong public pressure and calls from international donors, particularly the International Monetary Fund.

Several legislators said the committee would summon several people mentioned in the PwC report, particularly those recommended by the auditor for further investigation.

The attorney general and the police are also investigating the scandal.

Visiting IMF Asia Pacific director Hubert Neiss said on Wednesday that Indonesia must resolve the scandal satisfactorily, meaning that proper legal action should be taken against wrongdoers to restore confidence in the banking sector.

The previous administration of B.J. Habibie was reluctant to delve into the scandal because several people from Habibie's inner circle, including Golkar Party leaders, have been implicated in the affair. Habibie's administration also ignored a recommendation made by a special investigative committee of the previous House.

The move led in mid-September to the suspension of crucial international loans to Jakarta.

In a related development, Attorney General Marzuki Darusman said on Wednesday the investigation into the scandal could be completed by the end of the year.

Marzuki, who was speaking after receiving a copy of the PwC audit on the bank scandal from Akbar, said "there will be no conflict of interest" in the investigation.

Marzuki, a deputy chairman of Golkar, was rumored to be the individual who pushed for disclosure of the scandal.

The scandal revolves around the transfer of a Rp 546 billion (US$80 million on the June rate) commission from Bank Bali to private firm PT Era Giat Prima (EGP) as payment for services rendered in recouping some Rp 904 billion in interbank loans owed by closed down banks.

Bank Bali should not have used the service of EGP because the claims were guaranteed by the government through the Indonesian Bank Restructuring Agency (IBRA), a department of the finance ministry.

There have been allegations that part of the commission was to be used for bankrolling Habibie's presidential bid.

Corruption

PwC said in its report: "There are numerous indicators of fraud, noncompliance, ...and corruption during the processing and payment of the Bank Bali claims. PwC recommends that an additional investigation be conducted."

Public figures recommended for further investigations include former head of the Supreme Advisory Council (DPA) Arnold A. Baramuli, who was also Habibie's chief advisor, former state minister of the empowerment of state enterprises Tanri Abeng, former finance minister Bambang Subianto, Bank Indonesia Governor Sjahril Sabirin, BI executive Erman Munzir, IBRA deputy chairman Pande Lubis, Golkar executives Freddy Latumahina, Enggartiasto Lukita, Marimutu Manimaren, and Didi F. Korompis.

PwC said there were indications which suggested Baramuli's knowledge or involvement in the scandal.

PwC pointed out Baramuli's aggressive lobbying to the central bank governor to have Bank Bali's claims paid, and his alleged participation in a May 26, 1999 meeting at Hotel Mulia with several people heavily implicated in the scandal.

"Our tracing of the funds has not established a receipt of money by Baramuli out of the claim payment. The money trail, however, reflects that in early June 1999, a fellow member of DPA apparently did receive a payment," PwC said, referring to DPA member Agus Sudono who received more than Rp 2 billion.

PwC added that Baramuli and Tanri refused to be interviewed.

PwC said that factors which implicated Tanri in the scandal included his alleged participation at the Feb. 11 and May 26 meetings at Hotel Mulia, the transfers of about Rp 1.4 billion of funds to companies owned by the Tanri family and Rp 30 billion to a close associate of Tanri.

Regarding Bambang Subianto, the PwC report referred to his meetings with former Bank Bali president Rudy Ramli and Manimaren prior to the payment of the claims. The report also pointed out his long association with IBRA's deputy chairman Pande Lubis, who allegedly played a key role in the payment of Bank Bali's claims.

But the auditor also commended Bambang for his cooperation in the interview process.

PwC also listed names of people and companies who received funds, possibly from the commission, including EGP owner Joko Chandra, Setya Novanto (Golkar legislator), Iwan Tjahjadikarta, Bong No Li, OC Kaligis (a lawyer), Anna Boentaran (Joko's wife), Gani Djemaat (a lawyer), Judith Dirkin, Irvan Gunardi and MS Ralie Siregar. (rei/byg)