Salim may avoid criminal charges
The Jakarta Post, Jakarta
One of Indonesia's wealthiest businessmen, Salim, may escape criminal charges on abusing some Rp 52.7 trillion (about US$5.8 billion) in state loans after the Indonesian Bank Restructuring Agency (IBRA) announced he had settled his debts.
IBRA chairman Syafruddin Temenggung said on Tuesday the number of bad debtors who had settled their debts with IBRA had grown from four to five.
"The new one is Salim," Syafruddin said following a meeting with the Financial Sector Policy Committee (FSPC), which consists of senior economic ministers overseeing IBRA's high-profile debt restructuring deals.
The Salim Group was founded by Soedono Salim and is now run by his son, Anthony Salim. Syafruddin did not say on whom the deal applied to. "We just reported it (Salim's debt status) and declared it settled."
Of the 35 ex-bankers who abused a total of some Rp 138 trillion in Bank Indonesia emergency liquidity loans and violated banking regulations, Salim was the largest debtor.
In a 1998 shareholders settlement program, he and other ex- bankers agreed to repay the loans in return for avoiding criminal prosecution.
As part of the deal, IBRA took over their banks and other assets and has sold many of them to recoup the lost funds. However, with the repayment deadline expiring for many of the debtors this years, repayment has been minimal and the recovery rate on sold assets has been poor.
Plans to excuse from prosecution those debtors IBRA has deemed as cooperative has been met with public criticism.
Adding Salim to the list will likely add fuel to the current debate, as his debt settlement record is marked by controversy.
The founder of some of the country's most coveted companies, Salim has drawn criticism for allegedly regaining control of a number of the companies previously taken over and sold by IBRA.
Among these companies are car manufacturers PT Astra International (for Rp 2.1 trillion) and PT Indomobil Sukses International (Rp 625 billion), television company PT Indosiar Visual Mandiri (Rp 775 billion) and palm oil firms under Salim Palm Plantation ($365 million).
Analysts have charged that a number of the buyers acted as a front for Salim to allow him to regain control of his assets. Both Salim and IBRA denied the charges.
The sale of Salim's flagship Bank Central Asia (BCA) came under public scrutiny amid political meddling and charges that Salim was attempting to regain control of the bank.
It took IBRA nearly two years to sell BCA and the eventual buyer, an American investment firm that beat out UK-based Standard Chartered Bank, has raised concern among some parties.
Syafruddin said a team of independent lawyers hired by the government to assess the status of debtors would decide whether to recommend dropping criminal charges against Salim.
The final decision rests with the government. As yet, officials seem to be avoiding the matter in what analysts say is fear of a public backlash.