Officials 'put pressures' on Bapindo

JAKARTA (JP): Three former Bapindo directors disclosed in court yesterday that pressures from two cabinet ministers led them to approve huge loans to businessman Eddy Tansil, bypassing standard banking practices.

Towil Heryoto, Bambang Kuntjoro and Sjahrizal told the Central Jakarta District Court in separate testimony yesterday that Tansil's loan applications between 1989 and 1993 were not subjected to normal scrutiny. They said this was because they were supported by letters of reference from Sudomo, then the coordinating of political affairs and security.

The three men also said that in June 1992, Sumarlin, then the minister of finance, overruled their decision to cut their losses with Tansil's transactions and ordered them continue to make good on all their loan commitments to the businessmen.

Sjahrizal added a third cabinet official to the list of government officials who put pressure on the bank. That man was former junior finance minister Nasrudin Sumintapura.

These were the first public allegations of the extent to which the minister was involved in the Rp 1.3 trillion ($620 million) loan scandal at the government-owned Bank Pembangunan Indonesia (Bapindo).

The three former Bapindo executives were testifying in the trial of Tansil, owner of the Golden Key Group, who has been accused of siphoning off $448 million of the bank's money. The three are also under investigation by the Attorney General's office for their alleged role in the scam.

A fourth director, Adhi Sugondho, did not shed any new light at the hearing because he had already retired by the time the questionable transactions took place.

The testimony of a fifth director, Subekti Ismaun, was postponed until Saturday because the hearing dragged on until later afternoon. Subekti is also under investigation.

Sudomo is now the chairman of the Supreme Advisory Council on which Nasrudin also sits. Sumarlin is now the chairman of the Supreme Auditing Board.

"Without the reference letter from Sudomo, we would have followed the standard procedures in issuing the letters of credit for Tansil," Bambang Kuntjoro told the court.

Sjahrizal said Sudomo's reference letters attested that Tansil's venture was sound and that his integrity was beyond question.

Tansil was applying for loans to finance giant petrochemical projects in Cilegon, West Java.

He said that on June 2, 1992, the directors decided to cut their losses with Tansil and stop issuing further bankers' acceptance in connection with his loans. Tansil then had already received $208 million of his $432 million in loans.

Only hours later however, Sjahrizal said he was summoned to Sumarlin's office at which time he was ordered to allow Tansil to cash in on the remaining loans that were pledged to him.

"These are viable projects. You should continue (financing them)," Sjahrizal quoted Sumarlin as telling him at the meeting. "There's no need for concern, since other banks will join in the syndication to share out the risks."

Sjahrizal later returned to the office and informed other directors of Sumarlin's remarks. "This is a policy that we have to carry out."

Sudomo has been listed by the court as one of the witnesses to testify in court. However his court appearance is not yet certain since he has already given a deposition to the Attorney General's office, as has Sumarlin.

Sudomo never denied issuing the letters of reference for Tansil but stressed that this was normal practice and that the bank should still have assessed his creditworthiness.

Sumarlin had reportedly denied the existence of the June 2 meeting with Sjahrizal, saying he was out of town on that day.

Sjahrizal and Bambang also recalled that they met with Sudomo on at least two occasions to discuss the problems with Tansil in 1993 but each time the minister gave his assurances that Tansil "was not a problem."

In 1993 they had also demanded that Tansil repay all the money he had taken from Bapindo but this demand was ignored.

Towil, Sjahrizal and Bambang also blamed Maman Suparman, at the time deputy manager of Bapindo's Jakarta branch, of acting beyond his authority in issuing letters of credits for Tansil, changing the terms of the letters that allowed the beneficiary to cash in on loans ahead of delivery, and changing the name of beneficiaries into a Hong Kong-based company owned by Tansil.

This occurred for months until the head office became aware that something had gone sour with the loans on April 1992, and that Tansil never furnished the necessary documents to the Jakarta branch to support his loan applications.

The directors acknowledged that they had approved the loans before referring Tansil's loan arrangements to the Jakarta branch because the projects were feasible.

Both Towil and Bambang said they had a good "business feeling" about the project when deciding to open letters of credit to finance Tansil's import of equipment.

Bambang said that it was not unusual for the directors to use their discretion in approving loans while bypassing one or two of the normal procedures. (05)