The State-Owned Enterprises Ministry has denied allegations that Minister Erick Thohir might have benefited from Asuransi Jiwasraya's reckless investment. (Antara Photo/Galih Pradipta)

SOE Ministry Denies Allegations Jiwasraya Fallout Turns Tidy Profit for Minister Erick


DECEMBER 27, 2019

Jakarta. The State-Owned Enterprises Ministry has denied allegations that SOE Minister Erick Thohir might have benefited from a reckless investment by ailing state-owned life insurer Asuransi Jiwasraya five years ago. 

Erick has been at the forefront of recent efforts to uncover a dodgy investment scandal at the largest state-owned life insurer.

Jiwasraya had announced it was unable to pay more than Rp 12 trillion ($86 million) in insurance claims due this year and needs an estimated Rp 33 trillion in capital injection to keep itself afloat. 

Many have pointed out that Jiwasraya's reckless investment strategy in the past decade has led to its near demise.

Instead of investing in bluechip stocks, the insurer bought into third-tier or penny stocks, whose value was grossly inflated at the stock market.

Jiwasraya then lost a lot of money when the price of those stocks fell. 

Erick's accusers were quick to point out that Jiwasraya once bought shares in Mahaka Media, a listed media company controlled by the minister and speculated that he might have profited from Jiwasraya's loss.   

Arya Sinulingga, a special assistant to the minister, said on Friday that Jiwasraya bought the Mahaka shares on Jan. 23, 2014, at Rp 95 per share for a total of Rp 14.9 billion.

The insurer sold the stocks on Dec. 17, 2014, at Rp114 per share for a total of Rp 16 billion. 

"Jiwasraya turned a profit of Rp 2.8 billion... an 18 percent gain from buying the ABBA shares," Arya said, referring to Mahaka by its ticker code at the Indonesia Stock Exchange. 

Arya said the transaction was also almost entirely transparent that anyone could examine it.  

"This is not the case with 'pump and dump' stocks," Arya said. 

Criminal Inquiry

The Attorney General Office last week launched a criminal inquiry into possible corruption at Jiwasraya. 

On Friday, the Immigration Office banned the insurer's former president director Hendrisman Rahim and its former finance director Hary Prasetyo from traveling abroad.

It also banned eight other people connected to the inquiry from traveling abroad after a request from the Attorney General, Immigration Office spokesman Sam Fernando said. 

"That's right. They are prevented [from going abroad] as of Dec. 26 for the next eight months," Sam said.