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Indonesia Eximbank's Rp2.5 Trillion Fraud Saga

Updated: Apr 24

Indonesia’s Finance Minister, Sri Mulyani, reportedly took her report to the Attorney General’s Office (AGO) in the previous week. The report disclosed a suspicious activity identified in Indonesia Eximbank that is an institution of government encouraging business financing exportation. The fraud is said to have amounted to Rp2.5 trillion (US$178 million) according to the report. The Financial and Development Supervisory Agency (BPKP), the Deputy Attorney General for Civil, and State Administration, along with the Inspectorate General of the Ministry of Finance had agreed to combine their efforts in order to unveil these inconsistencies. The special team diligently scrutinized the loans’ records and uncovered four firms accused of committing fraud. The companies involved are PT RII (Rp1.8 trillion alleged fraud), PT SMR (Rp218 billion), PT SMI (Rp144 billion) and PT BRS (Rp305 billion). The Attorney General's Office revealed there is another chapter to this story. Apparently, a second phase of investigation is underway, focusing on six other companies suspected of pulling off a separate fraud scheme worth a whopping Rp3 trillion (US$ 214 million).  ⁤This case highlights the importance of vigilance in managing public funds. ⁤⁤The Indonesian government is committed to ensuring that institutions like the Indonesia Eximbank, which play a crucial role in supporting businesses and economic growth, operate with transparency and accountability. ⁤⁤By working together, the Ministry of Finance and the Attorney General's Office aim to recover these funds and hold those responsible accountable.

⁤The discovery and handover of fraud cases involving Indonesia Eximbank, also known as the Indonesian Export Financing Institution (LPEI), signify a commitment to upholding legal processes and addressing alleged criminal law violations by six debtor companies. LPEI emphasizes its adherence to regulatory frameworks and willingness to collaborate with authorities such as the Attorney General's Office and the Financial and Development Supervisory Agency to resolve issues concerning problematic debtors. Central to this collaboration is a dedication to good corporate governance and integration in operational activities, reflecting LPEI's mandate to support sustainable national exports. Meanwhile, Finance Minister Sri Mulyani, backed by findings from an integrated team including the Financial and Development Supervisory Agency and the Ministry of Finance, has reported potential corruption charges totaling Rp2.5 trillion against four export companies. These companies, accused of engaging in corrupt practices since 2019, span sectors like palm oil, coal, nickel, and shipping. Sri Mulyani underscores the importance of collaborative efforts between the Ministry of Finance and the Attorney General's Office to safeguard the integrity of Indonesia Eximbank and promote transparent financing practices in the export sector. In a meeting with Attorney General Sanitiar Burhanuddin, Sri Mulyani highlighted the significance of addressing corruption allegations promptly to mitigate state losses and ensure a fair and just legal process. As the investigation progresses into a second phase targeting six additional companies suspected of corruption amounting to Rp3 trillion, Burhanuddin urges full cooperation from the debtors in adhering to investigative procedures and recommendations from the Financial and Development Supervisory Agency. This collaborative approach underscores a concerted effort to combat fraud, uphold transparency, and maintain the credibility of Indonesia's financial institutions.

The government's response to the total non-performing loans amounting to Rp2.5 trillion experienced by these four companies indicates elements of corruption. These companies operate in the palm oil, coal, nickel, and shipping sectors. This finding originated from joint examinations by the joint team of the Financial and Development Supervisory Agency (BPKP), the Deputy Attorney General for Civil and State Administration (Jamdatun) of the Attorney General's Office, and the Inspectorate General of the Ministry of Finance since 2019. This case was then handed over to the Attorney General's Special Investigation (Jampidsus) due to indications of fraud or deviation. Currently, LPEI is working together with BPKP and Jamdatun Kejagung to conduct research on problematic loans. In addition, the Financial Services Authority (OJK) supports the Ministry of Finance in addressing challenges related to problematic financing at LPEI. In this regard, OJK is committed to conducting inspections, both directly and indirectly, of LPEI's operations. OJK is also actively coordinating with the Ministry of Finance regarding the oversight of LPEI's operations. The law enforcement and supervision efforts undertaken by various government agencies reaffirm the Indonesian government's commitment to safeguarding financial institutions such as LPEI, which play a crucial role in supporting economic growth and export activities. All parties hope that through collaboration and transparency among the Ministry of Finance, the Attorney General's Office, OJK, and other relevant agencies, this fraud case can be fully uncovered, funds can be recovered, and those responsible can be held accountable under the law.



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