Fri, 25 Feb 2000

Sjahril detects political move to unseat him

JAKARTA (JP): Bank Indonesia Governor Sjahril Sabirin said on Thursday that there has been political maneuvering to unseat him from the central bank by launching a renewed accusation that he was involved in the high profile Bank Bali scandal.

He stressed that he was not involved in the bank scandal that occurred in the middle of last year.

"There seem to be efforts to unseat me from Bank Indonesia... But I won't back down," Sjahril told reporters prior to questioning by the special investigative team on the alleged abuse of massive government bank liquidity supports.

The court hearing on the Bank Bali corruption scandal began in the South Jakarta District Court on Wednesday with the reading of an indictment against one of six suspects.

Prosecutor Ridwan Moekiat said that suspect Joko S. Tjandra collaborated with several top government officials including Sjahril to allow a private firm linked to the then ruling Golkar political party to "illegally" receive a huge commission from Bank Bali to assist the latter to obtain its interbank claims for a closed down bank.

"The political motive is too obvious here," Sjahril said.

"I'm not involved in the Bank Bali scandal. If you look at the PricewaterhouseCoopers audit report, my name was only mentioned once when Firman Soetjahja (former Bank Bali executive) said that I attended a February (1999) meeting. I already denied this."

Several top government officials reportedly held a meeting in February at a five-star hotel in Jakarta to design a strategy to recoup huge profits from the Bank Bali transaction.

There have been allegations that part of the money was supposed to be used to help Golkar win last year's presidential election. But revelation of the scandal partly contributed to the defeat of former president B.J. Habibie, the handpicked successor of former authoritarian president Soeharto.

Sjahril is also currently facing accusations of abuse in the transfer of multi-billion dollar government bank liquidity support facilities between late 1997 and 1998.

But Sjahril has denied this accusation.

The government, via the central bank, provided up to Rp 164.5 trillion (US$23 billion) in liquidity support to help ailing banks stay afloat.

But a recent general audit report by the Supreme Audit Agency (BPK) indicated that the transfer of some Rp 80 trillion of the liquidity facility was not made in accordance with proper procedures.

Sjahril assumed the Bank Indonesia Governor position in February 1998 when the central bank was not yet independent. But he was latter appointed to the same position in May 1999 for a four-year term following the enactment of the new central bank law ensuring the bank's freedom from control by the executive.

Under the new law, members of the board of governors of Bank Indonesia can be dismissed only by the House and only if they are proven to have violated the law or committed corruption.

BPK is currently conducting a special investigative audit on the matter, that is expected to be completed in May.

The House is conducting a separate investigation. In addition to Sjahril, the House also summoned on Wednesday former finance minister Bambang Subianto and former minister of state secretary Moerdiono. The House is scheduled to summon former finance minister Fuad Bawazier today. (rei)