House to probe into Bank Bali takeover by SCB

House to probe into Bank Bali takeover by SCB

JAKARTA (JP): The House of Representatives (DPR) joint
commission responsible for the review of the Bank Bali scandal
would undertake an investigation into the bank's management
takeover, the commission's chairman Sukowaluyo Mintorahardjo said
on Friday.

Over 300 employees from the beleaguered Bank Bali met with
House Commissions II and IX to ask the legislative body to take
action against the bank's takeover by Standard Chartered Bank
(SCB).

Bank Bali Senior Vice president Hadi Lesmono said the
government should review and cancel the investment and management
agreement with the London-based bank on grounds that
irregularities had been found in the takeover process.

"In June SCB ordered an audit to mark up Bank Bali's
recapitalization budget to Rp 4.3 trillion. In April the
government appointed audit company ordered by the Indonesian Bank
Restructuring Agency (IBRA) set the budget at Rp 2.57 trillion,"
he said.

Hadi also complained about the lack of transparency in the
takeover process, saying SCB had refused to disclose the report,
even to the taxation office, for tax purposes.

He said three directors and one employee had been dismissed,
while 45 others had been suspended on charges of provoking
demonstrations against the new management.

The chairman of Bank Bali employees union Ari Satrio said SCB,
which employs over 60 expatriates in managing Bank Bali, has not
provided legal documents for most of its foreign employees
working in Indonesia.

"We found evidence that most of expatriates do not even have
all the necessary documents and visas to work in Indonesia. Most
of them only came in with social-cultural visas," Ari said.

Ari alleged SCB had burdened Bank Bali with extra
inefficiencies, for example by renting a Rp 1 billion per year
house for SCB's Jakarta representative, buying a luxury car which
cost Rp 850 million and paying a monthly wage bill of Rp 7.5
billion for the bank's expatriates staffers.

"We were asked to announce that the wages for all 6,300 Bank
Bali employees only comes to Rp 8 billion." he said.

In response to the complaints, Sukowaluyo stated the House
would investigate the reports to prevent further financial losses
suffered by Bank Bali.

"The House is responsible to conduct an investigation into the
matter. If we find any evidence of misconduct in the takeover
deal, we will pass it on to the Attorney General, the police and
also the immigration office," he said.

In an unrelated development, Golkar party treasurer Fadel
Muhammad visited the National Police Detectives Office on Friday
to lodge a complaint against the validity of the
PricewaterhouseCoopers (PwC) audit, which implied that a Rp 15
billion loan received by the Golkar party from businessman
Marimutu Manimaren was "part of the Bank Bali scandal".

"That money was a personal loan from Manimaren to the Golkar
party. It had nothing to do with the Bank Bali scandal," Fadel
said.

Manimaren is also Golkar's deputy treasurer. (02/ylt)