Tommy Soeharto related case has seen him lose some USD 135 million. This should make a significant dent in his financial position. I am not sure that it is enough to push him to the brink of bankruptcy or destitution, but it should be felt (hopefully it will be felt!).
The Supreme Court finally overturned itself and decided for the Indonesian government in the long-running PT Timor Putra Nasional case. The company, PT Timor Putra Nasional, was a fraud from the start. The company was established with a view to producing a national car by a national car maker. However, the company did nothing more than import cars from South Korea and re-brand them. It was a fraud because the company was benefiting from subsidies and other facilities because it was creating a national industry that was intended to supply jobs to Indonesians and to move away from the reliance on car imports.
In contrast, as hindsight tends to be 20/20, the reality was that this was nothing more than another venture from a Soeharto child designed for personal enrichment under the protection of the iron-fisted rule of a dictator, who just happened to be Tommy's father.
The case went back to the Supreme Court because the Ministry of Finance presented two new pieces of evidence that were not presented at the earlier trial proceedings. These two pieces of evidence were letters from Tommy and the PT Timor Board of Directors guaranteeing payment to the government. This decision, according to Nurhadi, spokesperson of the Supreme Court, ends the appeal process. The decision is final.
Tommy with any interest that had accrued while the case was being heard.
The case was all over the place for so many reasons. It started with PT Timor defaulting on loans of some IDR 4.05 trillion during the 1997-1998 financial meltdown. In 2003 the Indonesian Bank Restructuring Agency (IBRA) stepped in and took over the assets and managed them through to an eventual sale. For reasons only known to IBRA its due diligence mechanisms failed to uncover that Tommy headed up the company, PT Vista Bella Pratama, who they sold the PT Timor assets to for a heavily discounted IDR 444 billion. This was a pretty significant return on the original investment for Tommy.
In legal moves in 2008, prosecutors argued that the deal had to be illegal because Tommy controlled both entities. The suit claimed the difference between the two amounts. The case was settled out of court with the government taking over all of PT Timor's assets and the IDR 4.05 trillion debt.
The Supreme Court has seemingly relied on this settlement and the new evidence to overturn the earlier decision they reached in the previous hearing of this case.
It remains to be seen as to whether this is some sort of seminal moment in the pursuit of ill-gotten wealth by the Soeharto clan. However, this clearly is a significant victory for the government.