GOVT READY TO FACE HOUSE PROBE INTO BANK CENTURY CASE

By Andi Abdussalam
Jakarta, Nov 13 (ANTARA) - The government said on Friday it was ready to face a House motion to probe the Rp6.7 trillion (US$723 million) bailout it had provided for ailing Bank Century.

        A total of 139 legislators officially submitted on Thursday a proposal to form an inquiry team for the investigation of the bailout. Ailing Bank Century was taken over by the Deposit Insurance Agency (LPS) late last year after it had a liquidity problem and was unable to refund its customers' money.

        The inquiry proposal was submitted by around 30 members of the House of Representatives (DPR) representing 139 members from seven factions that had given their signatures.

        Vice President Boedino said the initiative of a number of legislators to form an inquiry committee on the Bank Century case was a normal thing, and the government was ready to provide the needed information.

        "It (the inquiry initiative) is a normal thing. So, please go ahead. The main purpose is to make it clear to the public," the vice president told a press conference at his office here on Friday.

        Indications of criminal offenses in the Bank Century case were revealed during a closed-door meeting of the House of Representatives (DPR)'s Commission XI for financial affairs at the end of September, 2009. After studying the results of a progress report by the State Audit Board (BPK), the House found that various banking crimes had taken place in the bank.

        The interim audit report also indicated that abuse of authority or error of judgment by Bank Indonesia (BI/the central bank) and the Financial Sector Stability Committee (KSSK) had also occurred that had caused a considerable amount of financial loss to the state.

        After all, the funds were disbursed under Government Regulation in lieu of Law No. 4 / 2008 on Financial System Safety Net (JPSK) which basically was never approved by the House.

        The BPK auditors had said they had found irregularities in the disbursement of Rp6.7 trillion to bail out the bank. The bailout amount was far bigger than the Rp1.3 trillion previously discussed with the House.

        However, House Speaker Marzuki Alie refused to sign the inquiry proposal on Thursday. He said he would not sign the proposal to exercise the right of inquiry over f Bank Century case pending the final audit result from the State Audit Board (BPK).

        "The proposal came from around 140 members of the House of Representatives (DPR). Around 400 others still have yet to sign it. My position is like that of the other 400 members," he said when receiving the proposal at his office at the parliament building.

        The seven factions of the House which had supported the proposed inquiry were the Indonesian Democratic Party-Struggle (PDI-P), Golkar Party, United Development Party (PPP), National Awakening Party (PKB), People's Conscience Party (Hanura), Greater Indonesia Movement Party (Gerindra), and Prosperous Justice Party (PKS).

        However, House Speaker Marzuki Alie, who is also the secretary general of the ruling Democrat Party said support for the proposal was a commitment of individuals and factions. The Democrat Party faction will not as yet take a stance and prefer to wait for the final report from the BPK, he said.

        As the House Speaker, he said, he welcomed the aspirations of the 139 members.

        He said their proposal would be immediately discussed at a Consultative Body (Bamus) meeting. Marzuki said the proposal had already been discussed at DPR leadership level and the DPR leadership had decided to pass it on to the Bamus so that the Bank Century problem could be made more transparent and clearer.

        In the meantime, Vice President Boediono said the people needed clear information about the Bank Century case. Therefore, the government was ready to provide explanations.

        "We will provide whatever information is needed by the people. The people need clarifications so that they need not continue to question it and work again as usual," Boediono said.

        Boediono, who was the BI Governor when the bailout funds were disbursed, even said he was ready to be questioned by a House inquiry team to make the matter clear. "The vice president is also a citizen. As a citizen, I am ready to be questioned," he told a press conference.

        The government's decision to bail out the ailing bank at the time was an effort to overcome an emergency situation. There was an extraordinary problem, including a liquidity problem. So, if any criminal act had been committed in the bail-out process, it should be investigated, no matter who was involved.

        "So, we did not do anything wrong. Everything was based on existing regulations," the vice president added. He said people needed to understand the salvaging efforts made during the emergency situation, particularly to safeguard the system. If fraud proved to have taken place, it should be investigated, he added.

        "In an emergency situation we should first take salvaging measures, but if it later turns out fraud was committed in the process, that is another problem," he said.

        In the meantime, about 30 customers of Bank Century domiciled in Jakarta lodged a complaint with the Corruption Eradication Commission (KPK) on Friday, asking the anti-graft body to investigate suspected corruption at the bank. They asked the body to investigate the case because until now they had not been able to withdraw the funds they had deposited at the bank.

        This had happened although the ailing bank had been taken over by the LPS and had received bailout funds from the government amounting to Rp6.7 trillion. Gunawan Setiadi, one of the customers, said that there were at least two big cases involving Bank Century, namely embezzlement of customers' deposits by its management and misappropriation of the government's bailout funds.

        He said it was hard to understand that after receiving an injection of Rp6.7 trillion from the government, the bank could still not return the money of its small depositors totaling only Rp1.4 trillion.

        On the previous day, a delegation of several civil society organizations came to the KPK office to submit a report on corruption in the bailout of Bank Century. Addie Massardi, the delegation's spokesman, said the report was received by the KPK's public complaints section.

        "The Bank Century case is the source of the acute law enforcement-related problems the nation is facing now," Addie Massardi told reporters. ***4*** (T.A014/A/HAJM/19:30/a014) (T.A014/A/A014/A/A014) 13-11-2009 19:33:24