Prajogo grilled by AGO, denies graft charges

JAKARTA (JP): Timber tycoon Prajogo Pangestu was grilled by state prosecutors at the Attorney General's Office for almost six hours on Friday over alleged corruption practices that caused more than Rp 331 billion in losses to the state.

Prajogo told reporters after the questioning that the allegations, based on a report handed over by former secretary- general of the Ministry of Forestry Suripto, was not true.

"Such a report could only have been made by a mad man," he said, adding that he will ask the investigators to give him more time to clarify himself.

In the report, Suripto claimed that Prajogo's forestry concession PT Musi Hutan Persada had marked up the size of its timber plantation estate from its actual 118,000 hectares to 193,500 hectares in the early 1990s in order to obtain a state loan from reforestation funds, causing some Rp 331 billion in state losses.

PT Musi was also accused of reneging on its obligation to pay interest on a bank loan that had amounted to some Rp 154 billion late last year and had manipulated its assets and industry concessions to obtain Rp 9.91 trillion from a consortium of 25 international banks.

Suripto is now at the center of a controversy, which charges the former military intelligence officer with treason.

Prajogo has yet to be named a suspect.

His lawyer Denny Kailimang explained that the state losses caused by Prajogo were actually the company's debts to the state reforestation funds, of which the payments are due separately in 2004 and 2007.

Earlier in the day, former minister of forestry Hasjrul Harahap was also questioned at the Attorney General's Office as a witness in connection with Prajogo's case.

Hasjrul, who held the position between 1988 and 1993, was approved the loan although Prajogo had yet to pay his dues as required.

Separately, deputy attorney general for special crimes Bachtiar Fachri Nasution said the team investigating President Abdurrahman Wahid's alleged role in the Rp 35 billion graft at the State Logistics Agency (Bulog), is about to accomplish its task.

"Hopefully we can disclose the result of the investigation by the end of this month," he told journalists. (bby)