Probosutedjo grilled over marked up loan

JAKARTA (JP): Businessman Probosutedjo appeared at the Attorney General's Office on Wednesday to clarify his alleged involvement in the marking up of a loan obtained from the government's reforestation fund.

Probosutedjo, who is a younger step-brother of former president Soeharto, denied the allegation, saying that the entire amount of Rp 144 billion (US$15.2 million), which he received in 1994, had been used by his timber company PT Menara Hutan Buana to manage a 71,000-hectare estate.

"There was no markup (in the proposal) for the soft loan obtained from the reforestation fund ... it's not true. I have all the evidence," Probosutedjo, who was a forest concessionaire when the loan was disbursed in 1994, told journalists after more than four hours of questioning.

The case is one of a number of corruption cases reported by the Ministry of Forestry and Plantations as part of its efforts to recover massive amounts of misused reforestation funds, and to eradicate corruption in the ministry.

Indonesian Corruption Watch had earlier submitted its investigation results to the ministry alleging that Probosutedjo had asked for the loan to sustain a 268,585-hectare estate in South Kalimantan based upon a reference from Soeharto.

PT Menara Hutan Buana, which manages an 80,000-hectare estate, was a joint venture between Probosutedjo's PT Mercu Buana and state-owned forestry company PT Inhutani II. In 1999, Probosutedjo bought out Inhutani II's stake and became the outright owner. (bby)