Fri, 14 Oct 1994

Mar'ie orders thorough probe of export scam

JAKARTA (JP): Minister of Finance Mar'ie Muhammad said yesterday that he has assigned three top officials at his ministry to help the Attorney General investigate the case of bogus export documents.

The three are Director General for Customs and Excise Sahardjo, Tax Director General Fuad Bawazier and Director General for Financial Institutions Bambang Subianto.

Mar'ie said that assigning the first echelon finance officials reflected the government's seriousness in dealing with suspected export fraud.

The minister declined to explain the missions of the three director generals but sources at the ministry said Sahardjo and Fuad will probe the possible involvement of their subordinates in the alleged scam, while Bambang will investigate the role of commercial banks.

The minister said the use of bogus export documents had caused great financial losses to the state but he refused to disclose the exact amount of the losses.

Counterfeit export documents have been widely used to illegally obtain import duty and value-added tax rebates from the Export Service Facilitating Agency (Bapeksta) and to obtain the rediscount facility (subsidized export credit) from Bank Indonesia (the central bank).

The abuse of the facility has been extensively debated in local newspapers since last month following the disclosure of bogus export documents allegedly issued by Detta Marina, a Jakarta-based garment factory.

Kim Yohannes, the company's owner, reportedly used bogus export documents to obtain low-interest export credits from the central bank. He is now under investigation by the Attorney General's Office.

The export credit facility, carrying low interest rates, was introduced by the central bank in 1982 to support export-oriented companies. However, many exporters and commercial banks have illegally obtained the cheap credit facility by using bogus export certificates.

Major banks

Three major commercial banks also reportedly used bogus export documents to obtain subsidized export loans to finance their lending operations.

The finance minister refused to comment when he was questioned about the possible involvement of the three banks, which were reported to have paid fees of around two to three percent to Kim in return for providing the banks with phony export papers.

"I just support what the Bank Indonesia governor has said," he said.

Bank Indonesia Governor J. Soedradjad Djiwandono said recently that the central bank would investigate allegations of commercial banks' involvement in the abuse of the export credit facility.

"We don't know yet," he said about the alleged involvement of commercial banks in the scam.

Minister Mar'ie acknowledged yesterday that the abuse of the government's incentives to promote exports has affected the country's revenues.

"But it does not mean that we have to suspend the incentive policy only because of such a breach," he said. (hen)