Today’s Legal Enlightenment (Friday, 07 October 2022) – The Head of Sub-Branch Offices of State Owned Enterprises (BUMN) banks are still responsible if there are state losses due to bad loans, even though the one who signs the credit agreement is the Bank’s business director

Judex factie stated that the Defendant, the Head of the Sub-Branch Office of PT. Bri Agroniaga, is guilty of participating in a banking crime that resulted in bad loans. The bad credit has caused state financial losses. The Defendant filed an appeal against this decision to the Supreme Court. In the Memorandum of Cassation, the Defendant argues that he is not responsible for the occurrence of state losses because the credit contract/agreement with the channeling pattern, which resulted in bad loans, was carried out between the business director of Bank BRI Agroniaga Tbk, and the management of the Pertamina Employee Cooperative. Thus, it is not the responsibility of the Defendant.

The Supreme Court rejected the appeal on the basis that although the credit agreement between the business director of Bank BRI Agroniaga Tbk and the management of the Pertamina Employee Cooperative was not the responsibility and action of the Defendant, the credit application documents that the Defendant should have been prevented from being forwarded to the BRI Agroniaga Tbk Branch Office was not carried out. Instead, the Defendant allowed it to be sent to the BRI Agroniaga Tbk Branch Office, so the invalid documents eventually resulted in the occurrence of bad loans in casu.

Best regards,

Fredrik J. Pinakunary