Concerns About The Jiwasraya Case Which Has The Potential To Drag Other Sectors

JAKARTA - The case of PT Asuransi Jiwasraya's default, which was called the Supreme Audit Agency (BPK), could have a systemic impact, it is feared that it could potentially drag on other sectors. Deputy Executive Director of the Institute for Development of Economics and Finance (Indef) Eko Listiyanto reminded this, because the Jiwasraya case involved many parties from banks to investment management companies.

"Systemic and non-systemic have a period of time, they are stretched out, the uncertainty will make the systemic worse," he said in Jakarta, Thursday, January 9.

According to him, this could have an impact on, among other things, a decline in the performance of business sectors involved in the vortex of the Jiwasraya Insurance problem.

For this reason, Eko hopes that the government and other related parties will immediately and not hesitate to determine a solution for Jiwasraya Insurance.

Moreover, he continued, Indonesia's current economic condition is still stable enough to overcome the problems in the insurance BUMN.

"The rupiah is stable, foreign exchange even rising is a picture that the government should not hesitate to make decisions. This is different from the situation in 2009 which was all in uncertain conditions," he said.

Eko added that systemic risk in insurance companies is different from banking because the insurance industry is engaged in long-term investment and involves many institutions.

Likewise with the concept of bailout funds, he continued, banks have a Deposit Insurance Corporation (LPS) that can bail out bank companies if they are involved in systemic problems.

Meanwhile, insurance companies, said Eko, do not have similar institutions, so that the bailout is deemed impossible for insurance companies that are entangled in cases.

"Asuransi Jiwasraya owns BUMN, the shareholders are the government. That means the shareholders are ultimately responsible," he said.

BPK admits that it does not want PT Asuransi Jiwasraya's problems to grow bigger like the Century Bank case because if Jiwasraya's finances collapsed it would also have a systemic impact.

Chairman of the BPK, Agung Firman Sampurna, reminded that the case of misappropriation of Bank Century funds in 2008 was initially revealed to be Rp. 678 billion but eventually it grew to the point that it was suspected that the state had caused Rp. 6.7 trillion in losses.

Currently, PT AJS BPK is conducting investigative investigations to follow up on the DPR's request and the calculation of state losses to follow up on the Attorney General's request. "The BPK fully supports the Attorney General's Office in enforcing the law on the PT AJS case," said the Chairman of the BPK. pic.twitter.com/TQ1W0ykdSb

- BPK RI (@bpkri) January 9, 2020

BPK admits that it is still conducting investigations into Jiwasraya. On December 30, 2019, the Attorney General's Office also asked BPK to calculate state losses.

"The purpose of the investigative examination is to see allegations of fraud and indications of state losses," he said.

BPK admitted to finding a number of irregularities in Jiwasraya. Jiwasraya places its investment in low-performing stocks and chooses investment management that is of inadequate quality.

"The sale and purchase of shares is carried out with affiliated parties so that it does not reflect the true value of the shares," said Agung.

Agung said the Jiwasraya problem had been going on for a long time. Jiwasraya has allegedly been making false profits since 2006 because he committed accounting engineering actions to beautify his financial statements (window dressing).