Police detain three key suspects in two latest bank fraud cases

P.C. Naommy, The Jakarta Post, Jakarta

Police announced on Tuesday the detention of three of nine suspects in the fraud cases involving the now defunct Bank Dagang Bali (BDB) and Bank Asiatic.

According to National Police Spokesman Brig. Gen. Soenarko D.A., the arrest warrants for the two suspects from the Asiatic bank, FB Surendro, former president director and Made Budiana, former fund and marketing director, were issued on Monday night at 9:30 p.m. after an interrogation session lasting for more than nine hours.

The arrest warrant for the high ranking official of BDB I Gusti Ngurah Oka Budiana, had been issued last Friday shortly before his forcible arrest at his office in Jakarta.

Soenarko said the police had charged the three suspects under Banking Law No.72/1992 which was amended by Law No.10/1998.

Soenarko earlier said that the interrogation of the three suspects would likely revolve around their alleged involvement in the approval of loans which exceeded the legal lending limit under the Banking Law.

Asked about the other six officials who are still at large, Soenarko said that the police are trying to determine their whereabouts.

Hotman Paris, the lawyer of Tong Muk Keung, the majority share holder of Asiatic, said that his client would appear at the police headquarters on Wednesday.

"We have already received the summons, but we needed more time to prepare before going to the interrogation session," said Hotman.

The central bank revoked on April 8 the operational permits of the two banks, which are owned by two families connected by marriage, because of their worsening financial condition caused by what the central bank called fraudulent loan transactions worth Rp 1.2 trillion (US$139 million).

The loans had accounted for 70 percent of BDB's total assets of only Rp 1.7 trillion. Existing regulations state that a bank is allowed to lend a maximum of 10 percent of its total lending exposure to affiliated companies.

The government has provided Rp 2.39 trillion to cover the funds owed to the two banks' depositors as part of its blanket guarantee program.

The Denpasar-based BDB had 31 branches, 632 employees and 408,000 depositors at the time of its closure, while the Jakarta- based Asiatic had 150 staff members and 2,200 depositors.