Travel ban sought for Sarijaya's top brass

Ika Krismantari, ,  The Jakarta Post, ,  Jakarta   |  Fri, 01/09/2009 10:56 AM  |  Business

The Capital Market and Financial Institutions Supervisory Agency (Bapepam-LK) is stepping up efforts to hold the management of PT Sarijaya Permana Sekuritas accountable for an alleged fraud, by recommending a travel ban be imposed upon its top executives.

The travel ban is to ensure that they cannot flee the country during the investigation into the alleged scam by which Rp 245 billion (US$22.5 million) of customers' funds have been misappropriated, said Bapepam's head of the team investigating the case, Sarjito, Thursday.

"We cooperated with the police in submitting the travel ban requests to the immigration office," said Sarjito.

Sarijaya's president commissioner, Herman Ramli, has been in police detention since Dec. 24 for misusing funds, but Bapepam insists that there is no way the firm's management did not have knowledge of the illegal actions taken by the owner and therefore that they should also be held responsible.

The management had claimed the fraud only involved Herman as the owner of the firm and that he supposedly perpetrated his misconduct without the knowledge of company directors.

Bapepam however alleges that senior management has also played a role by allowing the president commissioner to make use of investor funds so as to channel them into 17 new accounts, under the names of others. It is believed that senior management succumbed to Herman's pressures.

Bapepam also plans to summon the Sarijaya board of directors for more questioning in relation to the case.

Herman is the younger brother of Rudy Ramli, the founder of now-defunct Bank Bali before it was later merged with four other banks to form Bank Permata.

Rudy was implicated in a case in the late 1990s revolving around irregular payments from a Bank Bali account to a firm belonging to an executive of the Golkar Party. A court however, acquitted him in 2000 of all charges.

Herman owns a 100 percent stake in Sarijaya, one of the nation's largest securities companies, which boasts 48 branches across the country.

Responding to the travel bans, Sarijaya lawyer M. Luthfi Hakim said his clients had not as of Thursday received the official notification of travel bans from the immigration office.

"The management is currently very busy in dealing with an assets verification process with the stock market regulator and negotiations with strategic partners, who have expressed interests in buying the company," he said.

"So we do not have the slightest ideas about going abroad, even less so to escape."

A number of investors have expressed their interest in buying the company. Among them is a consortium, whose owners come from Hong Kong, Melbourne, Australia and Indonesia.

Reports have also put the Djarum Group and Sinar Mas Group as being amongst the interested potential investors.

The Sarijaya case has again highlighted weaknesses in the supervisory role that Bapepam has been playing.

The case emerged just weeks after another fraud involving a securities company, with PT Antaboga Delta Sekuritas charged for allegedly misusing investor funds of Rp 1.4 trillion. Investigation into this case is also underway.

Bapepam, under fire for failing to detect such frauds much earlier, said it is revamping regulations to give it greater control in preventing fraudulent practices and to provide greater protection to investors.

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