NGOs rebuke WB for softening against bank scam

JAKARTA (JP): Non-governmental organizations lambasted the World Bank on Saturday for softening its stance on the administration of President B.J. Habibie over the high profile Bank Bali scandal.

Revrisond Baswir of the International NGO Forum on Indonesian Development (INFID) said the World Bank had decided not to investigate the involvement of Habibie's close associates in the scandal.

The World Bank claimed that because of its status as an economic institution it could not "enter the political field" of the Bank Bali case.

"The Bank said that it will be satisfied with the completion of (an independent) financial and legal audit of the case," he told reporters following a meeting with World Bank senior officials at INFID's headquarters.

World Bank vice president for East Asia and the Pacific Jean- Michel Severino, the Bank's country director for Indonesia Mark Baird, and three other staff members attended the meeting.

Revrisond said it was clear that the World Bank as well as other multilateral institutions like the International Monetary Fund and the Asian Development Bank will agree to a compromise resolution with the Habibie administration over the Bank Bali scandal.

"The World Bank and other multilateral donors will be involved in the high-level compromise talks," he said.

He explained that a satisfactory resolution to the Bank Bali scandal could not be reached without "touching" the political aspects of the case because of strong evidence of the involvement of Habibie's inner circle.

The public is expecting external pressure particularly from the World Bank and the IMF to help force the Habibie administration to thoroughly investigate all the influential people involved in the scam, including taking tough legal measures against them.

"The World Bank, IMF and ADB must also be responsible for the Bank Bali case," Revrisond said.

INFID executive secretary Binny Buchori said the Bank has shown that it was not serious when it threatened the government last week to suspend aid disbursement if it failed to swiftly and satisfactorily resolve the scandal.

"The Bank told us that the Bank Bali case can't prompt them to indefinitely suspend aid disbursement (to Indonesia)," she said.

"Baird even said that his earlier threat was only meant to push the government to resolve the case swiftly and satisfactorily," she added.

Baird issued the threat on the sidelines of a seminar on the Indonesian economy last week.

But Severino said in Singapore on Sunday Indonesian authorities have given the go-ahead to PricewaterhouseCoopers to audit Bank Indonesia, the country's central bank.

Severino added that President B.J. Habibie's government will also make a statement on the progress of the investigation at the House of Representatives on Sept. 4.

He reiterated the World Bank stand that all non-project loans will be halted if the investigations aren't settled in a transparent manner.

Binny added that the Bank would be satisfied if the independent financial audit and legal audit of the Bank Bali case were completed.

Revrisond said the World Bank and other donor institutions do not really care whether the influential people involved in the scandal would be punished or not.

He said that the primary mission of the multilateral institutions in this country was to maintain their existence here to preserve the business interests of their "capitalist financiers".

The Bank Bali scandal revolves around the transfer of some Rp 546 billion from Bank Bali to EGP as a "commission" fee for the latter's services in helping the bank recoup interbank claims on closed down Bank BDNI from the government.

The Indonesian Bank Restructuring Agency (IBRA) has said that Bank Bali should not have used the services of EGP because the interbank claims are guaranteed through the government blanket guarantee program.

There has been increasing evidence of the involvement of several Cabinet ministers and President B.J. Habibie's close associates in pushing Bank Bali to use the services of EGP.

There have been allegations that the Bank Bali funds were to be used to help finance Habibie's presidential race in November. But the money was returned two weeks after the case was revealed to the press in late July.

The Habibie camp has been trying to nullify the evidence. A controversial statement was made by former Bank Bali president Rudy Ramli last week denying the existence of a personal diary said to be his and containing a chronology of his successive meetings with several senior ministers and Habibie's close associates in the run-up to the Bank Bali transaction with EGP.

Minister of Justice/State Secretary Muladi issued on Thursday copies of Rudy's denial statement to reporters after a Cabinet meeting.

The Indonesian Democratic Party of Struggle (PDI Perjuangan) lodged a complaint on Friday with police against Rudy in connection with his denial statement.

"That is a blatant lie, since I have his account. Rudy gave it to me voluntarily when he came for legal help on Aug. 11 and asked me to be his lawyer," said Amien Haryoso, deputy head of the legal department at PDI Perjuangan's research and development division.

"Rudy has practically written a diary on the whole process of the transaction, from beginning to end," he said.

There is speculation that Rudy was pressured by the Habibie camp to sign the denial. (rei)