Many were shocked but few surprised to learn last week that the Indonesian Bank Restructuring Agency (IBRA) had paid "protection money" to members of the military to secure IBRA property assets.
Statements made by two parliamentarians that IBRA had bribed members of the House of Representatives budgetary committee to ensure the smooth sale of nationalized Bank Niaga were denied two weeks ago, but few people believed the denials.
The furore over shady deals at IBRA escalated when IBRA deputy governor Sumantri Slamet said Wednesday that IBRA had a "cooperative" arrangement with the military under which it paid regional commands to ensure security at the hundreds of property assets taken over in the aftermath of the economic crisis of the late 1990s.
Indonesian press reports said the agency had paid billions of rupiah but neither IBRA nor the military has commented on the total amount.
Indonesian Armed Forces (TNI) Commander Endriartono Sutarto and TNI spokesman Sjafrie Sjamsoeddin both denied any knowledge of the arrangement the following day and even said the military might make a defamation case against IBRA over the matter.
Sutarto made a point of saying that Jakarta Special Province Commander, Maj Gen. Ahmad Yahya, had been implicated in the press reports he had read, reported detikcom.
The explanation offered by Yahya on Saturday only heightened public apprehension over the country's endemic corruption.
He said the money had been given directly to officers and was not "on the books" at all. He then introduced the notion that there was an actual "contract" involved and the fact that the contract ended on March 31 had spelt the end of the deal with IBRA.
Yahya said IBRA had paid officers across Indonesia Rp 750,000 ($82) per month in 1998 for food, transport and "extras" but this was increased to Rp 1 million per month in 2000 and then Rp 1.4 million prior to the end of the contract.
Yahya said the military had ordered personnel to guard and ensure security of IBRA property assets but had not apportioned resources, as such, to the task of fulfilling the order.
"So, the regional commands never received the money but it was given directly to the officers themselves. Starting last March, all members of the Jakarta Command have not been permitted to work outside their official TNI duties," he said in his defense.
Earlier Yahya denied that the Jakarta Military Command had ever received any of the funds. He took over the command in July this year.
He was then forced to deny that he had received any money prior to moving to Jakarta when he was commander of the Wirabuana Military Command, which covers South, Central, Southeast and North Sulawesi and Gorontalo provinces.
Just why IBRA's Slamet would wish to drum up more controversy for the agency in the wake of the Niaga brouhaha is unknown. Asset Sales Internal politicking and scandal aside, the agency has its hands full as it attempts to sell further property assets in Jakarta and beyond.
Head of IBRA's communications division Raymond van Beekum said last week the agency had finalized its second-stage property assets sales program (PPAP) for January 2003. The first-stage program is still ongoing but the second-stage asset sale will be done in blocks rather than as individual properties, he said.
In addition to raising badly needed funds to balance the budget, the agency wants to rid itself of maintenance costs (including, presumably, the cost of the military "protection") and enliven the secondary property market.
Property affairs observer Panangian Simanungkalit said the second stage sale is designed to anticipate a drop in the price of the property assets, reported Antara. The block sale highlights the emphasis on attracting businesses and property investors.
In other property news at IBRA, three investors – PT Berca Indonesia, PT Puspita Nirmala, and PT Sarana Inti Trasindo Perkasa – have submitted bids for 47.5% of real estate company PT Metropolitan Kentjana.
IBRA spokesperson Irawati Koswara said the three investors were expected to complete their tender documents last Friday and may increase their bids.
Metropolitan Kentjana runs the Pondok Indah Mall, Pondok Indah Estate, Wisma Metropolitan I and II, and the World Trade Building in Jakarta.