A New Chapter of The BLBI Case



Laila Afifa

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  • TEMPO.CO, JakartaThe chase after assets held by Bank Indonesia Liquidity Assistance (BLBI) recipients should continue with all the force of the law behind it. This needs to be done with transparency and no favoritism.

    THE government's task force in charge of claims in the Bank Indonesia Liquidity Assistance (BLBI) cases, should not limit itself to chasing after the obligations and assets of money launderers. The government should make law enforcement paramount against those bank owners who embezzled central bank fund injections towards the end of the New Order government back in 1998.

    Unfortunately, the creation of this task force feels like a mere formality. It seems like the government established the entity to not lose face after the Corruption Eradication Commission (KPK) halted their investigation into BLBI corruption cases. The task force was announced after the anti-corruption body issued a warrant stating a halt to all investigations (SP3) towards the case involving Sjamsul Nursalim and his wife.

    This is the first time the KPK halted an investigation into a corruption case. Authority to issue an SP3 warrant came after the law governing the KPK was revised by the Joko Widodo government in conjunction with the House of Representatives (DPR) at the end of 2019.

    Initially, the Sjamsul case was mentioned as the first step to uncover the BLBI corruption scandal concerning several banks. Sjamsul was highlighted for allegedly causing the state losses amounting to Rp4.58trillion. His Bank Dagang Nasional Indonesia (BDNI) now liquidated received liquidity assistance amounting to Rp47 trillion during the financial crisis at the time. He reimbursed the funds by submitting bank and company assets, his shrimp farms, and cash. Later on, it turned out some of the assets were problematic. Moreover, it was indicated that the liquidity assistance was instead used to bolster the interests of his shareholders.

    Sjamsul is only one of many bank owners who abused the assistance facility. Bank Indonesia coughed up around Rp147 trillion to save 48 banks on their last gasps in the 1997-1998 financial crisis. A major portion of credit disbursements that put those banks on the brink had benefited their own business interests. BDNI's branch in the Cook Islands, for example, transferred funds amounting to US$607 million to 10 companies owned by Sjamsul himself in Singapore, Hong Kong, and Taiwan.

    Efforts towards the closure of the BLBI corruption case have now entered a new chapter. The government expects the task force for BLBI claims to lasso back state funds totaling Rp110 trillion from the 48 bank owners. Indeed, even with no such task force in place, it is imperative for the government to get back those embezzled funds. The Supreme Audit Agency (BPK) deduced, of the entire BLBI facility, some Rp138.4 trillion was embezzled. The scandal has for too long been left in limbo, yet the amounts are too big to allow it to be forgotten.

    The tricky part is, investigating and seizing obligations and assets from obligors is no easy matter. Many of these assets are now in the hands of third parties. Certain obligor-owned assets have even changed hands to foreign owners. The situation has forced the government to first sign mutual legal assistance (MLA) agreements with these countries. In the MLA with Switzerland, for instance, negotiations conducted by Indonesia took some 13 years. The government is also obligated to provide a criminal element in the court case in Indonesia to be able to seize any assets located there.

    So that there is the assurance it is no mere paper tiger, the team created by Jokowi needs to be given clear targets. All due processes need to be conducted in a transparent manner and with no taint of favoritism. All names of obligors and assets to be claimed should be disclosed widely to the public. In this way, the public too can join the scrutiny and demand government accountability. The mechanism of physical detention for roguish obligors and affiliated family members should be coupled into the chase.

    The option to threaten criminal sanctions against obligors unwilling to return assets should be maintained, particularly if issues of later corruption emerge. This process should be on par with getting the money back into state coffers. The chase after BLBI obligor assets cannot be meted out a pardon, and the money not be returned to the state.

    Read the Complete Story in Tempo English Magazine