Trial of Bank BDB graft case begins

JAKARTA: The South Jakarta district court started on Monday the first hearing into alleged banking crime at the now defunct Bank Dagang Bali (BDB), which caused the state to suffer some Rp 1.3 trillion (US$136.84 million) in financial losses.

Prosecutors charged I Gusti Ngurah Oka Budiana, founding shareholder of the bank and the main suspect in the case, of among others setting up 31 fictitious companies in 2000, which were later used as vehicles to borrow money from the bank.

Budiana forced the bank's management to approve the credit application although it did not meet prudent banking requirements. Prosecutors also accused Budiana of transferring the bank's funds deposited in another bank to other 40 fictitious companies.

The central bank shut down BDB in May of last year after its financial condition worsened due to the illegal financial transactions. The government was forced to cover the money of over 400,000 depositors. -- detikcom