Jakarta - An official from Indonesia`s ruling Golkar party had been formally
charged in connection with a bank scandal that rattled markets and sent
tremors through the country`s political landscape, his lawyer said
Setya Novanto, a deputy treasurer of Golkar, was charged with breaking
banking laws after questioning by police, said OC Kaligis, his lawyer. "He
has been charged with breaching bank laws," Kaligis said.
A police spokesman could not comment on details of the investigation, but
confirmed Novanto had been questioned.
The Bank Bali scandal has shaken financial markets. Some analysts said it
threatened President BJ Habibie`s chances of retaining power in November`s
The controversy revolves around payment of more than $70 million by Bank
Bali to a firm run by Novanto to help recover loans from the Indonesian Bank
Restructuring Agency. Opposition parties allege the money was destined for
Habibie`s re-election fund. But Habibie insists he received no money.
Indonesia`s opposition said the saga must be fully investigated. It warned
of attempts to make scapegoats of lower-level figures and protect the
The World Bank and International Monetary Fund (IMF) have threatened to cut
off assistance to Indonesia if the case was not properly investigated and
The billions of dollars pumped into Indonesia`s economy by foreign donors
are crucial for keeping the beleaguered economy afloat.
The IMF has demanded an independent audit of the central bank as part of the
investigation into the issue. Indonesia has agreed to let
PricewaterhouseCoopers help with an audit, but it is not clear how much
freedom the firm will be given.
Analysts say a truly independent bank audit might uncover issues that
officials would be anxious to keep hidden. - Reuters