http://www.thejakartapost.com/news/2009/01/28/ago-likely-drop-indover-graft-probe.html
The Attorney General’s Office is likely to cease an investigation into a corruption case in the central bank’s Netherlands-based unit, Indonesische Overzeese Bank N.V. (Indover), that allegedly incurred US$1 billion in state losses.
“We may drop the investigation because to date we cannot find common ground with the authorities in the Netherlands in deciding whether the graft exists or not,” assistant attorney general for special crimes Marwan Effendy said Tuesday.
He said the AGO would begin studying the possibility of filing a civil lawsuit over the Indover case to allow the government to recover the lost funds.
Marwan added prosecutors had long believed the disbursement of a $1 billion loan could lead to strong indications of graft, but added the Dutch authorities had decided otherwise.
“[The Dutch authorities] believe the loan disbursement is not even worth being considered a crime, and if something happens during the process then all related parties should find an amicable settlement," he said after a meeting between the AGO and officials from the Supreme Audit Agency (BPK) to discuss the Indover fiasco.
"And that's the problem that has been hampering our investigations all the way.”
The country's Criminal Code allows Indonesian investigators to start an investigation into a case that has occurred abroad, once the relevant authorities from both countries have reached a similar understanding of the case.
In its report, the BPK found indications of fund misappropriations by top Indover officials that amounted to $1 billion.
In 2001, the AGO began an investigation into the loan scandal, naming the bank’s former president director, Sidharta S.P. Suryadi, and former managing director of its Hong Kong unit, Permadi Gandapraja, as suspects in the misappropriation of the money.
But Marwan said the two suspects would likely be released soon, given the fact that prosecutors could find no strong reasons to keep them in custody any longer.
The AGO had been requested by Finance Minister Sri Mulyani Indrawati to revive the suspended 2001 graft probe into Indover, as part of the ministry's far-reaching efforts to unravel a more recent mess in the collapsed bank.
On Oct. 31 last year, Bank Indonesia announced it would have to let Indover fold, after failing to make good on a planned 545.6 million euro bailout.
BI had earlier failed to secure written approval for the bailout from legislators before a deadline set by the Dutch authorities.
The initial decision to salvage Indover was driven primarily by a BI-issued “support letter” that was somehow misinterpreted as evidence of a central bank guarantee to the bank’s creditors, as well as binding the government to the bank’s obligations.
Local and overseas creditors insist BI be held responsible for leading them into the mess resulting from the support letter. (*)
The Attorney General’s Office is likely to cease an investigation into a corruption case in the central bank’s Netherlands-based unit, Indonesische Overzeese Bank N.V. (Indover), that allegedly incurred US$1 billion in state losses.
“We may drop the investigation because to date we cannot find common ground with the authorities in the Netherlands in deciding whether the graft exists or not,” assistant attorney general for special crimes Marwan Effendy said Tuesday.
He said the AGO would begin studying the possibility of filing a civil lawsuit over the Indover case to allow the government to recover the lost funds.
Marwan added prosecutors had long believed the disbursement of a $1 billion loan could lead to strong indications of graft, but added the Dutch authorities had decided otherwise.
“[The Dutch authorities] believe the loan disbursement is not even worth being considered a crime, and if something happens during the process then all related parties should find an amicable settlement," he said after a meeting between the AGO and officials from the Supreme Audit Agency (BPK) to discuss the Indover fiasco.
"And that's the problem that has been hampering our investigations all the way.”
The country's Criminal Code allows Indonesian investigators to start an investigation into a case that has occurred abroad, once the relevant authorities from both countries have reached a similar understanding of the case.
In its report, the BPK found indications of fund misappropriations by top Indover officials that amounted to $1 billion.
In 2001, the AGO began an investigation into the loan scandal, naming the bank’s former president director, Sidharta S.P. Suryadi, and former managing director of its Hong Kong unit, Permadi Gandapraja, as suspects in the misappropriation of the money.
But Marwan said the two suspects would likely be released soon, given the fact that prosecutors could find no strong reasons to keep them in custody any longer.
The AGO had been requested by Finance Minister Sri Mulyani Indrawati to revive the suspended 2001 graft probe into Indover, as part of the ministry's far-reaching efforts to unravel a more recent mess in the collapsed bank.
On Oct. 31 last year, Bank Indonesia announced it would have to let Indover fold, after failing to make good on a planned 545.6 million euro bailout.
BI had earlier failed to secure written approval for the bailout from legislators before a deadline set by the Dutch authorities.
The initial decision to salvage Indover was driven primarily by a BI-issued “support letter” that was somehow misinterpreted as evidence of a central bank guarantee to the bank’s creditors, as well as binding the government to the bank’s obligations.
Local and overseas creditors insist BI be held responsible for leading them into the mess resulting from the support letter. (*)
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