BNI Madiun Branch Distributes IDR1.4 Billion Fictitious Credit

Thursday, 12 OCtober 2017 , 16:00:00 WIB -

Police are seen in a motorcycle inspection in Madiun, East Java, Friday (22/9). (ANTARA)

JAKARTA, GRES.NEWS – The Police of Madiun are investigating into fictitious credit distribution by state-run bank Bank Negara Indonesia (BNI), Madiun Branch, that amounted to around Rp1.4 billion (US$103,573.26) to cooperative KSP Galang Artha Sejahtera.

The owner of the cooperative, HW, is currently under questioning for embezzling up to Rp1,439,895,184. The credit was distributed in 2012-2014 to around 300 members of the cooperative.

"The modus operandi was members of the cooperative applied for small business credit, commonly dubbed Kredit Usaha Rakyat (KUR) in Indonesia, yet many of the cooperative members have not applied for such credit," Hanif Fatih Wicaksono, Chief the Madiun Police, Tuesday (10/10/2017).

Investigators have also found that the debt total was marked up.

KSP Galang Artha Sejahtera applied credit worth Rp2 billion. However, in July 2017 the bad loans related to the credit reached Rp1,439,895,184. (dtc/mfb)