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Wednesday, February 08, 2006

Law Must Be Enforced in Settling Debtors Problems

Jakarta - The government has to look into the legal aspects in handling debtors of Bank Indonesia (BI)`s non-performing liquidity credits (BLBI), former chief the State Audit Board (BPK), Satrio B. Joedono said here on Wednesday."The question is whether the money or the law is important. For me, the law is important," Joedono said referring to reports that four debtors had plans to return the non-performing credits to the government.Reports quoted the finance minister as saying earlier that there were four BLBI debtors who wanted to return the money to the government.

The finance minister said she would discuss with the chief economic minister and the police chief the legal aspect that could be imposed on settling the debtors problem. Joedono said BLBI debtors had been given a chance to settle their debts through the Master of Settlement and Acquisition Agreement (MSAA).With the MSAA settlement, the debtors agreed to return the money but they failed to do so, he said.With the MSAA mechanism, debtors who had signed the agreement were given the `release and discharge` facility, whereby debtors would be freed from legal findings if they returned all amount of the credits they had received from BI, the central bank.

Earlier on Monday, three debtors came to the state palace to meet President Yudhoyono. The three were Lukman Astanto, Ulung Bursa and James Januar who respectively owed the government Rp615 billion, Rp190 billion and Rp123 billion.According to National Police chief Gen. Sutanto, they came to the state palace to follow the steps of Bank Bira`s commissioner Atang Latief who has earlier expressed readiness to return the BLBI funds to the government.Latief has been in hiding in Singapore along with many other debtors.

The government provided BLBI funds totaling Rp144.5 trillion from August 1998 to early 1999 to assist 48 ailing private banks. However, in May 1999, a Supreme Audit Agency report revealed that 95 percent of the troubled banks had misappropriated the funds.Based on reports, the Police Chief said, the debtors actually wanted to return their debts through the Indonesian Bank Restructuring Agency (IBRA) which was already liquidated.

"They wanted to return their debts, but don`t know to whom. So they issued a statement on their readiness to return their debts. In the absence of an institution to handle their debts, the settlement of their debts became protracted. Now they are able to solve their case," he said.Police Chief Gen Sutanto said on Tuesday that debtors who have surrendered themselves may not have to undergo a legal process, because according to law enforcers there was no indication they had violated the law although they had yet to secure a document stating they had paid their debts (SKL)."Their past and present status are not classified as having violated the law," Sutanto


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