Former boss of Bank Mandiri, E.C.W. Neloe has been exonerated from corruption charges.
EDUARD Cornelis William Neloe could not hide his joy upon hearing the verdict handed down by the South Jakarta District Court over his case, last Monday. Following trial, Neloe was swamped by dozens of journalists. He was also greeted by family members and colleagues, shaking his hand and congratulating him on the favorable verdict. "I have been seeking justice for a long time and today I have received it, although it is not over yet," Neloe told journalists.
Chaired by judge Gatot Suharnoto, the judicial panel presiding over Neloe's case exonerated Neloe and two other Bank Mandiri directors, I Wayan Pugeg and M. Sholeh Tasripan from corruption charges made against them for their involvement in the Bank Mandiri credit loan scandal.
The court verdict has sparked controversy. The prosecution indicted Neloe, Pugeg and Tasripan on corruption charges for approving a Rp160 billion bridging loan and US$18.5 million in investment credit to PT Cipta Graha Nusantara (CGN). The prosecution charged the three defendants with violating the Anti-Corruption Law.
During his reading, judge Gatot outlined the three offences included in the prosecutor's indictment: committing an illegal act; attempting to profit oneself, another person or a corporation; and causing loss to the state. According to Gatot, the first charge had been met because the credit approval had deviated from the standard operation procedure (SOP). "Bank Mandiri Crediting Policy stipulates that the loan should be binding," explained Gatot. However, this condition was not enforced. According to Gatot, the second charge had also been met because the credit loan profited CGN, enabling it to purchase the credit assets of PT Tahta Medan.
However, the court ruled that the third charge of causing loss to the state had not been met. "Based on the testimony given by expert witnesses, there was no loss caused to the state," Gatot declared. The court applied the Laws on the State Treasury in adjudicating the matter. "These laws stipulate that loss caused to the state must be shown in the form of a real, factual and definite amount," Gatot explained. He also announced that there was no dissenting opinion--the verdict was unanimous.
The verdict has sparked controversy. "I am extremely disappointed with the verdict," said Attorney General Abdul Rahman Saleh. The prosecution had called upon the court to sentence Neloe to three years in prison in addition to fining him Rp1 billion. Prosecutor Baringin Sianturi accused the court of misinterpreting the law in adjudicating the final charge of "causing loss to the state". According to Baringin, the court applied the Anti-Corruption Law in adjudicating the first two charges of "illegal conduct" and "profiting another person". "But, when dealing with the charge of 'causing loss to the state', the court applied the Laws on the State Treasury," explained Baringin, accusing the court of acting inconsistently in its ruling.
According to Baringin, the Anti-Corruption Law (Law No. 31/1999) stipulates that corruption is a formal offence. This means that if the elements of "illegal conduct" and "profiting another person" are met, the loss caused to the state need not be shown in the form of a 'real and definite' amount. Any indication of loss caused to the state should be enough to fulfill the final charge.
Neloe's lawyer, Rocky Awondatu rejected Baringin's claims, maintaining that the court was correct in applying the Laws on the State Treasury. "Even if the Anti-Corruption Law deals with loss caused to the state, this does not mean that other laws are inapplicable," he said.
Rocky further insisted that the state did not suffer loss as a result of Neloe's actions. Rocky referred to two letters sent from Bank Mandiri to Bank Mandiri Director, Sholeh Tasripan, dated December 21 and December 30. According to Rocky, these letters stated that there was no evidence that CGN had fallen behind in repaying the primary debt, any fines or interest, or the remaining claim which had not passed the 2007 deadline.
Gatot further explained that there had been no debt rescheduling in this case because the credit repayment deadline had originally been set at 2007. However, Gatot did acknowledge that there had been a postponement of interest payments. Nevertheless, the court concluded that there was no element of conspiracy or embezzlement on behalf of the defendants. The court also noted that the credit repayment installments had been met. "There is no problem with the credit, so the state can not be considered to have suffered loss," said Gatot.
But Prosecutor Baringin rejects this reasoning. According to Baringin, these repayment installations were only made to settle the case. "They only took place after we arrested the debtors," Baringin claimed.
Baringin's claim was corroborated by judge Johanes Suhadi, one of the judges presiding over the other Bank Mandiri case, involving CGN directors Edyson, Saiful Anwar and Diman Ponijan. Chaired by Sri Mulyani, the judicial panel presiding over that case also exonerated the three defendants from corruption charges, again on the grounds that the charge of "loss caused to the state" had
not been met. Judge Johanes gave a dissenting opinion in the case, opposing the majority verdict.
According to Johanes, the first charge of "illegal conduct" had been met because the request for credit was approved in just one day without undergoing the requisite debtor analysis and collateral checking stages. This violated the banking guidelines set for Bank Mandiri and other banks. "This violated the principles of prudent banking. Loss to the state occurred at the moment the credit was extended," explained Johanes.
Former House of Representatives (DPR) Law Commission member, Firman Djaya Daeli, concurred. According to Firman, the court should have considered the spirit behind the Anti-Corruption Law. According to Firman, the Anti-Corruption Law has a broad definition of "loss caused to the state". "The charge of loss to the state would have been met under this law," said Firman, adding that the judicial panel took a narrow interpretation of the charge.
Separately, criminal law expert from the University of Indonesia, Rudi Satryo, confirmed that the court and the prosecution had applied different laws in the Bank Mandiri case. According to Rudi, the Anti-Corruption Law does not require the prosecution to show "concrete loss" caused to the state. However, Rudi conceded that the judges may have been searching for clearer legislation, and the State Treasury Laws give a clearer stipulation on the issue of "loss caused to the state".
According to deputy coordinator of Indonesia Corruption Watch, Danang Widyoko, the verdict gives strength to claims that the South Jakarta District Court is a graveyard for corruption lawsuits. This belief has already been proven in the corruption cases involving Nurdin Halid, Pande Lubis and Tjoko Tjandra, Ricardo Gelael, Tommy Suharto and Sudjiono Timan. "The only reason that BNI directors were found guilty of corruption by the court is because the Corruption Eradication Commission (KPK) strictly monitored that case," said Danang.
In the meantime, South Jakarta District Court head, Andi Samsan Nganro, has refused to comment on the case. Andi defended the judicial panel verdict, but acknowledged that the public lacks trust in the judiciary as a result of the actions of some unprofessional judges. "I can understand how such a big case has triggered this reaction," said Andi, acknowledging this problem.
Abdul Manan, Dian Yuliastuti, Maria Hasugian
TEMPO, MARCH 06, 2006-027/P. 28 Heading Law
EDUARD Cornelis William Neloe could not hide his joy upon hearing the verdict handed down by the South Jakarta District Court over his case, last Monday. Following trial, Neloe was swamped by dozens of journalists. He was also greeted by family members and colleagues, shaking his hand and congratulating him on the favorable verdict. "I have been seeking justice for a long time and today I have received it, although it is not over yet," Neloe told journalists.
Chaired by judge Gatot Suharnoto, the judicial panel presiding over Neloe's case exonerated Neloe and two other Bank Mandiri directors, I Wayan Pugeg and M. Sholeh Tasripan from corruption charges made against them for their involvement in the Bank Mandiri credit loan scandal.
The court verdict has sparked controversy. The prosecution indicted Neloe, Pugeg and Tasripan on corruption charges for approving a Rp160 billion bridging loan and US$18.5 million in investment credit to PT Cipta Graha Nusantara (CGN). The prosecution charged the three defendants with violating the Anti-Corruption Law.
During his reading, judge Gatot outlined the three offences included in the prosecutor's indictment: committing an illegal act; attempting to profit oneself, another person or a corporation; and causing loss to the state. According to Gatot, the first charge had been met because the credit approval had deviated from the standard operation procedure (SOP). "Bank Mandiri Crediting Policy stipulates that the loan should be binding," explained Gatot. However, this condition was not enforced. According to Gatot, the second charge had also been met because the credit loan profited CGN, enabling it to purchase the credit assets of PT Tahta Medan.
However, the court ruled that the third charge of causing loss to the state had not been met. "Based on the testimony given by expert witnesses, there was no loss caused to the state," Gatot declared. The court applied the Laws on the State Treasury in adjudicating the matter. "These laws stipulate that loss caused to the state must be shown in the form of a real, factual and definite amount," Gatot explained. He also announced that there was no dissenting opinion--the verdict was unanimous.
The verdict has sparked controversy. "I am extremely disappointed with the verdict," said Attorney General Abdul Rahman Saleh. The prosecution had called upon the court to sentence Neloe to three years in prison in addition to fining him Rp1 billion. Prosecutor Baringin Sianturi accused the court of misinterpreting the law in adjudicating the final charge of "causing loss to the state". According to Baringin, the court applied the Anti-Corruption Law in adjudicating the first two charges of "illegal conduct" and "profiting another person". "But, when dealing with the charge of 'causing loss to the state', the court applied the Laws on the State Treasury," explained Baringin, accusing the court of acting inconsistently in its ruling.
According to Baringin, the Anti-Corruption Law (Law No. 31/1999) stipulates that corruption is a formal offence. This means that if the elements of "illegal conduct" and "profiting another person" are met, the loss caused to the state need not be shown in the form of a 'real and definite' amount. Any indication of loss caused to the state should be enough to fulfill the final charge.
Neloe's lawyer, Rocky Awondatu rejected Baringin's claims, maintaining that the court was correct in applying the Laws on the State Treasury. "Even if the Anti-Corruption Law deals with loss caused to the state, this does not mean that other laws are inapplicable," he said.
Rocky further insisted that the state did not suffer loss as a result of Neloe's actions. Rocky referred to two letters sent from Bank Mandiri to Bank Mandiri Director, Sholeh Tasripan, dated December 21 and December 30. According to Rocky, these letters stated that there was no evidence that CGN had fallen behind in repaying the primary debt, any fines or interest, or the remaining claim which had not passed the 2007 deadline.
Gatot further explained that there had been no debt rescheduling in this case because the credit repayment deadline had originally been set at 2007. However, Gatot did acknowledge that there had been a postponement of interest payments. Nevertheless, the court concluded that there was no element of conspiracy or embezzlement on behalf of the defendants. The court also noted that the credit repayment installments had been met. "There is no problem with the credit, so the state can not be considered to have suffered loss," said Gatot.
But Prosecutor Baringin rejects this reasoning. According to Baringin, these repayment installations were only made to settle the case. "They only took place after we arrested the debtors," Baringin claimed.
Baringin's claim was corroborated by judge Johanes Suhadi, one of the judges presiding over the other Bank Mandiri case, involving CGN directors Edyson, Saiful Anwar and Diman Ponijan. Chaired by Sri Mulyani, the judicial panel presiding over that case also exonerated the three defendants from corruption charges, again on the grounds that the charge of "loss caused to the state" had
not been met. Judge Johanes gave a dissenting opinion in the case, opposing the majority verdict.
According to Johanes, the first charge of "illegal conduct" had been met because the request for credit was approved in just one day without undergoing the requisite debtor analysis and collateral checking stages. This violated the banking guidelines set for Bank Mandiri and other banks. "This violated the principles of prudent banking. Loss to the state occurred at the moment the credit was extended," explained Johanes.
Former House of Representatives (DPR) Law Commission member, Firman Djaya Daeli, concurred. According to Firman, the court should have considered the spirit behind the Anti-Corruption Law. According to Firman, the Anti-Corruption Law has a broad definition of "loss caused to the state". "The charge of loss to the state would have been met under this law," said Firman, adding that the judicial panel took a narrow interpretation of the charge.
Separately, criminal law expert from the University of Indonesia, Rudi Satryo, confirmed that the court and the prosecution had applied different laws in the Bank Mandiri case. According to Rudi, the Anti-Corruption Law does not require the prosecution to show "concrete loss" caused to the state. However, Rudi conceded that the judges may have been searching for clearer legislation, and the State Treasury Laws give a clearer stipulation on the issue of "loss caused to the state".
According to deputy coordinator of Indonesia Corruption Watch, Danang Widyoko, the verdict gives strength to claims that the South Jakarta District Court is a graveyard for corruption lawsuits. This belief has already been proven in the corruption cases involving Nurdin Halid, Pande Lubis and Tjoko Tjandra, Ricardo Gelael, Tommy Suharto and Sudjiono Timan. "The only reason that BNI directors were found guilty of corruption by the court is because the Corruption Eradication Commission (KPK) strictly monitored that case," said Danang.
In the meantime, South Jakarta District Court head, Andi Samsan Nganro, has refused to comment on the case. Andi defended the judicial panel verdict, but acknowledged that the public lacks trust in the judiciary as a result of the actions of some unprofessional judges. "I can understand how such a big case has triggered this reaction," said Andi, acknowledging this problem.
Abdul Manan, Dian Yuliastuti, Maria Hasugian
TEMPO, MARCH 06, 2006-027/P. 28 Heading Law
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