‘Investigations’ off course, flawed with political bias

While according to former vice president Jusuf Kalla the key to ending the uncertainty in the Bank Century bailout is to follow the money trail, the bailout inquiry has taken the investigations on a different course.

After almost 3 months of investigations, House of Representatives’ inquiry committee has spotted no trace of President Susilo Bambang Yudhoyono’s inner circle profiting from the bailout.

The committee, which is due to wrap up the inquiry on March 4, was initially set up with the main task of verifying whether part of the President’s campaign fund, allegedly deposited in Bank Century, had been a motive for the bailout — which eventually multiplied tenfold to Rp 6.76 trillion (US$716 million).

Instead of sniffing out the money trail, however, the committee has spent most of its time debating over semantic issues, for example what justified the assumption that the bank posed a “systemic” risk to the banking sector (an assumption that formed the basis for the government and central bank’s decision to salvage Bank Century in mid-November 2008).

Despite its power, the committee has also failed to retrieve the names of the 20 major depositors in Century, before and after the bailout. By uncovering these names, the committee could have at least challenged earlier allegations of the President’s proxies behind the bailout move.

Recent developments have seen the committee returning empty handed after sending five different teams to conduct “field investigations” in Jakarta, Medan (North Sumatra), Makassar (South Sulawesi), Denpasar (Bali) and Surabaya (East Java).

From these investigations no significant findings surfaced.

In Makassar, committee members could not find a solid link between Amiruddin Rustan, the owner of an auto repair shop, and Yudhoyono’s campaign team — as was boasted earlier by committee members.

Committee member Akbar Faisal from the People’s Conscience Party (Hanura), sent to Makassar, said he suspected Amiruddin to be affiliated with a company dubbed Rustan Consulting, which according to the General Elections Commission (KPU) had donated money to Yudhoyono’s campaign team.

However, after questioning Amir-uddin, Akbar retracted his statement, claiming he had misread the data.

The Bali team, meanwhile, failed to gain permission from the executive director of Bank Mutiara’s Bali branch to obtain financial transactions data on suspicious depositors. (Following the bailout, Bank Century was re-branded as Bank Mutiara.)

With the committee’s efforts failing on these accounts, allegations have emerged that it was set up to provide political leverage and provide a vehicle for vested interests for certain parties.

Coordinating Political, Legal and Security Affairs Minister Djoko Su-yanto has said the committee deviated from its original goal to oust Vice President Boediono and Finance Minister Sri Mulyani Indrawati.

It is no longer a secret that members of the inquiry committee were engaged in 24-hour meetings while top party officials were organizing backroom deals at the Mulia, Sultan and Le Meridien hotels in Jakarta. According to a politician from the Prosperous Justice Party (PKS), the deals were not based on any findings by the committee, but covered the endgame for the inquiry, and benefits for the politicians.

A senior politician from the National Mandate Party (PAN) also said the backroom deals had intensified, with bargaining chips including for the positions of the Vice President, finance minister, central bank governor and several executive posts in lucrative state companies and government agencies.

Coordinating Economic Minister Hatta Rajasa, who is also the PAN chairman, denied that the government was proposing several top jobs in state companies or state agencies in exchange for a political deal.

Indonesian Survey Institute (LSI) political analyst Burhanuddin Muhtadi said that while the committee had been successful in some areas it had largely deviated from its original goal. “The inquiry managed to reveal that there was a lot of mismanagement by Bank Indonesia in supervising banks and in providing special treatment.”

“However, during its journey, it is undeniable that the committee was overloaded with political interests. These interests led its members to make biased assumptions and set predetermined goals before any investigations had been carried out,” he said.

Committee chairman Idrus Marham of the Golkar Party denied that the committee had gone off track, claiming that there had been a theme-based inquiry schedule and strategy from the start.

JP/Irma

Timeline of Yudhoyono vs Bakrie

 

Jan. 28, 2010

• Street rallies throughout the country held to mark the first 100 days of Yudhoyono’s administration. They mostly demand the impeachment of Yudhoyono following allegations that his inner-circle had profited from the Bank Century bailout. Most of the rallies are believed to be financed by political elites.   

•  The tax office reports to legislators a possible 100 largest tax evaders. Among them are Bakrie companies.

Jan. 29

• Golkar senior politician and House of Representatives deputy speaker Priyo Budi Santoso says the impeachment of Yudhoyono, despite it’s cost to the country, is possible. For Boediono it is likely.

Jan. 29 - Feb. 7

• Politicians, analysts and high-ranking state officials debate the possibility of impeaching Yudhoyono.

Feb. 7

• A meeting between Yudhoyono and Golkar chairman Aburizal is possibly held at the President’s private residence in Cikeas, West Java.

Feb. 8

• Yudhoyono tells the National Police to crackdown on tax evaders. Yudhoyono’s statement, although not specific, is seen to be directed at Aburizal.

• Seven parties, including those of the coalition, insist there is fault in the bailout, outlined in the preliminary findings of the investigation committee. The committee also faulted Finance Minister Mulyani and then Bank Indonesia governor Boediono (now Vice President) for their decision to bail out Century.

Feb. 9

• A pre-trial hearing at South Jakarta Court dismisses request by PT Kaltim Prima Coal, a Bakrie family affiliated company, for the tax office to drop its investigation into alleged tax evasion.

Feb. 10
• Aburizal demonstratively summons Cabinet ministers and provincial governors affiliated with the party to a meeting on the Golkar Party office at the House of Representatives. He also says he is not
afraid of being threatened at gunpoint, let alone by tax-evasion allegations.

• Yudhoyono meets with Aburizal and Golkar high-ranking officials.

• Aburizal clarifies the harsh remarks he made earlier in his private blog.             

Feb. 11

• While no specific case is cited, Yudhoyono lashes out against the danger of collusion between politicians and businessmen to an audience at the Presidential Palace. He also repeats the need to stand strong against tax evaders.