Indonesia to take legal action against offenders in Bank Century case: president

05:22, March 05, 2010      

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Indonesian President Susilo Bambang Yudhoyono said on Thursday that his government would follow up the result of investigation of parliamentary inquiry team, which indicated there were crimes and violation on Bank Centrury case, and to impose a punishment.

The statement follows the recommendation of parliament on Wednesday that most of lawmakers agreed that there were violation on the bailout of 6.7 trillion rupiah (some 730 million U.S. dollars) against the small bank during the global recession in 2008.

"We must follow up the indication of violation and crime conducted by certain parties (persons) that caused the country suffered from financial loss. We must ensure that whether the violation was an administrative or legal violation so that the correction and punishment will be appropriate," President Yudhoyono said in his address at the State Palace on Thursday evening.

The parliamentary inquiry team has declared two Indonesian top reformers, Vice President Boediono who was the central bank governor during the case occurred and Finance Minister Sri Mulyani Indrawati, are responsible against the bailout as they had given approval on the rescue of the bank.

The bailout case has divided parliament, both coalition allies of Yudhoyono and opposition parties united against him on voting Wednesday night, which resulted 325 votes in favor of a criminal investigation of the two technocrats and 212 against.

It means that both Vice President Boediono and Finance Minister Sri Mulyani would face legal process over their decision.

But, President Yudhoyono defended the two technocrats saying that he agreed and were also responsible with the policy to rescue the bank as an efforts to rescue the economy from the impact of the global recession.

President Yudhoyono said that he was not linked directly with the policy making. He said that under the country's law the decision could be made by the chairperson of the Committee for Financial System Stability (KSSK) Sri Mulyani and Boediono without president approval.

"I was in overseas when the decision was made. I was not asked for a guidance and I did not give any instruction on the policy making because based on the law the KSSK can make decision without the involvement of president. But I can understand and support the decision," Yudhoyono said.

The statement may save the president from the final target of the case.

President Yudhoyono also defended the bailout saying that the decision was approved by the parliament at that time.

On his coalition, as the three of the coalition parties, the Golkar Party, the United Development Party and the Prosperous and Justice Party did not support him at the parliament, Yudhoyono said that "there would always be a right and honorable solution on it."

Yudhoyono did not say whether he would kick or keep some ministers from the parties at his cabinet.

Mulyani and Boediono are considered the main drivers of reform in Indonesia and play key roles in bringing foreign investment in the Southeast Asia's largest economy.

Analysts have warned that if either of the technocrats were forced to resign over the case, foreign investors would worry about prospects for reform, and there would be a sharp sell-off in the rupiah, stocks and bonds.

They have been defended their approval on the bailout, saying that it aimed at securing the country from the deepening impact of the global financial routs.

Source: Xinhua
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