IFC suspects voting fraud
IFC suspects voting fraud
JAKARTA (JP): The International Finance Corporation (IFC), a
subsidiary of the World Bank, might lose a bankruptcy petition
against publicly listed PT Panca Overseas Finance (POF), due to
what the IFC suspects as fraudulent voting by fictitious
creditors.
IFC legal representative Luhut M.P. Pangaribuan, who spoke on
behalf of the company, said the IFC would lose its bankruptcy
case against POF, if the Jakarta Commercial Court proceeded with
the creditors' voting next week.
"We suspect that the voting on Monday (next week) will be
attended by fictitious creditors voting against the bankruptcy,"
Luhut told The Jakarta Post on Thursday.
The IFC, he said, filed the bankruptcy against POF in
September last year, after the latter failed to pay US$13 million
in matured debts to the IFC.
Besides the IFC, 17 other foreign creditors supported the
bankruptcy petition against the POF, which has a total matured
debt of $67.24 million, Luhut said.
But two months after the bankruptcy petition was filed, the
POF gave the court a list of 14 new creditors with debts
amounting to Rp 1.6 trillion (about US$168.42 million).
According to Luhut, the 14 new creditors had expressed their
agreement on a proposed 10-year debt restructuring plan, under
which the POF was to pay only 10 percent of total debts incurred.
Under the 1998 Bankruptcy Law, a company survives a bankruptcy
petition, if the majority of creditors - representing at least
two-thirds in value of the debtor's outstanding debts - vote for
accepting the company's debt restructuring proposal.
But, failure to gain a majority vote, would cause the POF to
be automatically declared bankrupt.
"We'll be outnumbered by fictitious creditors," Luhut said,
and claimed the bankruptcy law contained serious loopholes.
He said the IFC had hired a private investigator to examine
the validity of these new creditors.
The POF, he said, obtained the fresh loans on July 10, 2000,
based on a syndicated loan agreement led by Hong Kong firm,
Harvest Hero International Limited.
The IFC's research, he said, found several irregularities in
the companies that channeled the loans, and the process under
which the POF obtained them.
Inquiries in Hong Kong revealed that Harvest Hero had no
permits to engage in international lending activities.
The company did not own a telephone line, and the company's
only employee was its director Oen Robin Ilmuwan, he said.
"We found out that the director was actually a Soto Mie
(chicken soup) seller in one of the shops in Kelapa Gading,"
Luhut added.
He said that the remaining companies, mostly based in West
Samoa and the Bahamas, were also suspected to have no permits for
channeling international loans.
"They are, what is called a paper company; useful for various
purposes," he said.
The Capital Market Supervisory Agency (Bapepam) also
questioned the loans, as it should have been made under the
approval of POF's shareholders.
POF executives were, however, not available for immediate
comment.
The IFC, Luhut said, had already requested the court to
examine the validity of the 14 creditors, but the court rejected
the IFC appeal, and ordered instead to move forward the voting
date from Feb. 15 to Monday Jan. 15.
He added that the IFC and the 12 initial creditors planned to
walk out during the voting process.
The POF is a member of the Panin Group and is 50.5 percent
owned by PT Panincorp, 22 percent by PT Panin Investment
Enterprises Ltd and 6 percent by the IFC.(bkm)