SBAT Embroiled in Case; Controller Blacklisted from Capital Markets for Five Years

Jakarta — The Financial Services Authority (OJK) has imposed sanctions on textile eminent PT Sejahtera Bintang Abadi Textile Tbk (SBAT) and related parties for violations of affiliated transaction and conflict of interest provisions in the capital market.

In an official statement, the OJK stated that the company was sanctioned with a written warning for failing to implement conflict of interest transaction procedures as stipulated in OJK Regulation Number 42/POJK.04/2020.

The violation relates to a reduction in loan interest rates in Addendum 4 of Credit Agreement No. 54 dated 8 July 2020 between SBAT and PT Mitra Buana Korporindo (MBK).

Additionally, the transaction also occurred in Addendum I of the Debt Recognition Agreement on the same date between SBAT and PT Celestia Sinergi Indonesia (CSI).

The OJK determined that these transactions constituted conflict of interest transactions as they involved parties with relationships to the company’s controller.

In this matter, Tan Heng Lok, as the controller of SBAT, was also found to be the controller of both MBK and CSI. This situation allowed Tan Heng Lok to benefit from the reduction in interest rates in these transactions, which was deemed to have caused harm to the company.

For these violations, the OJK imposed sanctions on Tan Heng Lok comprising a fine of Rp45 million and a prohibition from serving as a member of the board of commissioners, director, or officer of any capital market-related company for five years.

Meanwhile, SBAT was sanctioned with a written warning.

The OJK emphasised that the imposition of these sanctions is part of law enforcement efforts in the capital market sector to ensure that capital market activities run in an orderly, fair, and efficient manner and to maintain public confidence in the financial industry.