Bapepam didn’t bark

The idea of getting ripped off in a scam is depressing enough, but to see regulators wash their hands of the matter as though they lacked the authority to detect and prevent the fraud is no less frustrating.

SHORTCHANGED: Bank Century customers gather at the lender’s branch in Senayan, South Jakarta, on Wednesday, demanding the bank take responsibility for the losses they suffered from their investment in mutual funds issued by the bank’s partner Antaboga Delta Sekuritas. (JP/Ricky Yudhistira)

Hundreds of people, hemorrhaging money through an investment product issued by PT Antaboga Delta Sekuritas and sold by Bank Century, protested Wednesday at the Capital Market and Financial Institutions Supervisory Agency (Bapepam-LK) office after storming Century’s headquarters earlier in the day.

“How come Bapepam and Bank Indonesia claim they know nothing about the product?,” said Budi, an investors who stands to lose more than Rp 5 billion.

He rejected a recent statement by Bapepam that Antaboga was not authorized to issue such a product, which usually comes in the form of a mutual fund. “They’ve been selling it for years, so how could Bapepam miss it all this time?”

Yolanda, another victim, was incensed over Century’s recent claims that it could not be held responsible because the product was not a “banking product” and the lender only acted as a reseller.

“As Century customers, we were approached by the bank’s staff about the product. So how could can they not be held responsible now this has been revealed as a fraud?” she said.

Antaboga is linked to Century through its 7.44 percent stake in the lender.

The Century-Antaboga case unfolded weeks ago after hundreds of investors were unable to redeem their investments from Antaboga, through the Deposit Insurance Corporation (LPS), following Century’s recent takeover by the government.

The investors later reported the matter to Bapepam, which in turn reported it to the police. On Dec. 4, the National Police announced Antaboga president director Hendro Wiryanto and two other Antaboga executives, director Anton Tantular and commissioner Hartawan Aluwi, as suspects in the case.

Anton is the brother of Robert Tantular, a key shareholder in Century.

The police said reports from Century customers earlier this month showed the three executives allegedly embezzled a total of Rp 233 billion (US$21.4 million). That figure, however, jumped to Rp 1.4 trillion on Tuesday as more investors reported losses.

While Bapepam is working closely with the police to resolve the case, protesters at Wednesday’s rally decried Bapepam’s, and to an extent Bank Indonesia’s, failure in detecting the fraud much earlier.

Protest coordinator Gunawan said the victims now expected the government to resolve the case immediately, saying, “If the government was willing to take over Century, they must be willing to guarantee our investments.”

“We just want our money back,” said David, a Century customer from its Makassar, South Sulawesi, branch, who flew thousands of kilometers to join his fellow victims in Jakarta.

Sardjito, head of Bapepam’s investigations and inspections bureau, told the protesters’ representative the agency would continue investigating Antaboga and Century thoroughly.

But even the police now question Bapepam’s supervisory role.