Two tried in $9.3m construction scam

JAKARTA (JP): A prosecutor asked the Central Jakarta District Court on Monday for jail terms of six years and five years respectively for a developer and official charged in a US$9.3 million scam in the construction of a condominium project.

Prosecutor Hamid Thahir also asked the court to order defendants Seno Margono, alias Tjiong Tjek Seng, president of private developer PT Duta Adhiputra, and Hindro Tjahjono Soemardjan, director of the government-controlled Kemayoran Area Development Board, to pay Rp 9.1 billion ($1 million) compensation.

"We consider it a crime in the development of the condominium instead of a civil case," Hamid said.

The defendants also showed no remorse, he added.

He declared the defendants violated Article 1 (a) of Corruption Law No. 3/1971 which carries a maximum penalty of a life sentence and/or Rp 30 million fine.

Hamid stated in the indictment that the defendants illegally used a 25,000-square-meter plot of state land in Kemayoran, Central Jakarta, as collateral for bank loans.

He said use of the land to obtain collateral was illegal since it was not approved by then minister/state secretary Moerdiono.

Seno used land certificates to acquire loans amounting to Rp 65 billion from a bank syndication led by Bank PDFCI, he said.

Seno, a son-in-law of businessman Hendra Rahardja, the owner of the BHS Group, used Rp 48 billion of the loan to further his company's interests, he said.

Hamid said Seno and Hindro signed a cooperation agreement on March 17, 1993, to construct the condominium project with a capital commitment of $61.87 million.

He said that under the agreement, the board would provide the Kemayoran plot worth $9.37 million as part of the capital, while Seno would provide the remaining $52.5 million capital commitment.

Seno never provided the capital and, allegedly with Hindro's approval, converted the status of the land from a state asset into a company assets to acquire the loan, he said.

Presiding judge Poerwanto adjourned the trial for two weeks to hear the defendants' plea. Both defendants have been remanded in custody. (jun)