Sjahril may face four-year jail term over Bank Bali scandal

Muninggar Sri Saraswati, The Jakarta Post, Jakarta

Central Bank Governor Sjahril Sabirin is facing a possible four year imprisonment for allegedly being involved in corruption linked to the Bank Bali scandal, which led to government losses of some Rp 904 billion (US$96.2 million).

Sjahril was also ordered to pay a Rp 30 million fine.

Prosecutor Y.W. Mere told the trial at Central Jakarta District Court on Wednesday that Sjahril had abused his authority as the governor of the central bank in approving the loans of the Indonesian Bank Restructuring Agency (IBRA) to Bank Bali.

Bank Bali had asked for the money as payment for its loan to Bank BDNI, the now-defunct private bank, which was unable to repay its debts when it was taken over by IBRA.

"The central bank's approval was bizarre, considering that in a meeting at Mulia Hotel on February 11, 1999, it consistently rejected Bank Bali's request for the fund," Mere said, before the hearing, presided by judge Subardi.

According to Mere, Sjahril attended the meeting, which was aimed at approving Bank Bali's request for the loans, together with former Bank Bali director Rudy Ramli, former minister of investment and state enterprises and development Tanri Abeng, businessmen Setya Novanto, Firman Soetjahja and Irvan Gunardwi, as well as former chairman of the Supreme Advisory Council A.A. Baramuli.

The meeting was organized by Djoko S. Tjandra, a director to factoring firm PT Era Giat Prima, which later received some Rp 546 billion from Bank Bali as commission for helping secure the repayment.

Djoko and former IBRA deputy chairman Pande Nasorahona Lubis were tried at Central Jakarta District Court last year but the court acquitted them of all charges related to the Bank Bali scandal.

After the meeting, Mere said, Sjahril approved a verification letter stating that Bank Bali deserved to get the loan although he had received several reports mentioning that Bank Bali's request could not be approved as it did not meet the necessary requirements.

"The defendant has committed corruption...by illegally enriching other parties," Mere said.

According to Mere, Sjahril's action as the central bank governor had ruined the public's trust in the country's financial institutions during the current economic crisis.

Sjahril was charged for violating Article 1 Paragraph 1 of Anticorruption Law No.3/1971.

The court will resume on Nov. 14 to hear Sjahril's defense.

After the trial, Sjahril who looked calm during the hearing, claimed that he was shocked with the sentence.

"I did not expect such a sentence, though I realized that it would be impossible for me to be free of the charges," he told reporters, adding that he suspected there was a political reason for his trial.

Sjahril had been detained at the Attorney General's Office on June 21, 2000 and only released some five months later. He refused to resign claiming that he could still carry out his duties as the governor of the central bank, despite the charge against him.