Trial of Bank BDB graft case begins

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