To begin its formal investigation into the Rp 6.76 trillion (US$716 million) Bank Century bailout, the antigraft body interrogated Tuesday Raden Pardede, the former secretary of the Financial System Stability Committee (KSSK).
Acting head of the Corruption Eradication Commission (KPK), Tumpak Hatorangan Panggabean said Raden was questioned for more than three hours in relation to documents submitted by Finance Minister Sri Mulyani Indrawati regarding the committee’s decision to bail out the bank. However, he declined to specify what questions were directed to Raden during the long session.
Raden confirmed he was questioned in relation to documents submitted by the finance minister to the antigraft commission on Nov. 30, a day before a plenary session of the House of Representatives decided to form a special inquiry committee to conduct a procedural investigation into the bailout.
“I was asked to explain the preliminary handling of the bank by the KSSK,” he said.
The KPK has begun a thorough criminal investigation to follow up on a report by the Supreme Audit Agency (BPK) that found indications of corrupt practices in the government’s decision to bail out the ailing bank.
The BPK found at least nine legal and regulatory violations in its audit of the initial merger forming Bank Century and the bailout process.
The antigraft body has appointed a 36-member investigation team to probe all the decisions and policies made by the government that may have enriched public officials or other parties in the bailout process.
Raden reportedly took part in the meeting presided over by KSSK chairperson Sri Mulyani on Nov. 20-21, 2008, to discuss the financial problems the bank was facing. The meeting was also attended by Vice President Boediono, then Bank Indonesia governor, and commissioners of the Deposit Insurance Agency (LPS). The KSSK meeting followed a central bank leadership meeting, which declared Bank Century a failed bank posing a systemic threat to the banking sector.
The funds initially issued by the government to the bank amounted to Rp 632 billion and was eventually raised to Rp 6.76 trillion, arousing criticism and suspicion by the public, forcing the House to request the antigraft commission carry out a thorough inquiry into the scandal.
Tumpak also said the KPK would question all public officials, including Sri Mulyani and Boediono, who played key roles in the process leading to the issuing of the bailout funds.
“Investigators have planned to grill Sri Mulyani. Summoning her is a matter of time and she is only one of many public officials who needed to justify the bank bailout,” he said.
No officials or former officials have been named as graft suspects thus far and the KPK has been widely criticized for its perceived sluggishness in probing the case.
