Indonesian state prosecutors have charged a politically connected lawyer with a document fraud that allegedly used a fictitious letter of credit (L/C).

The case relates to the failed Bank Century. The lawyer who faces the charges, Mukhammad Misbakhun, has been an outspoken critic of the Indonesian authorities' handling of the bank's collapse.

Procedures

Prosecutors allege that Misbakhun requested a loan from Bank Century without going through the proper procedures.

The lawyer has been detained since 26 April for allegedly submitting false documents in support of an L/C application to Bank Century, which has now been renamed Bank Mutiara.

Loan status

A trial court heard that in 2007, Misbakhun's trading company, PT Selalang Prima International, received US$22.5 million in credit from Bank Century.

That credit is now reportedly categorised as a non-performing loan.

Denials

Misbakhun, who has been involved in the investigations of the government's controversial bail out of Bank Century, denies the allegations. (DC World News, 4 March 2010).

He claims the deal related to the L/C was cancelled, therefore the L/C was defaulted rather than fictitious.

Misbakhun could face a maximum sentence of 15 years in jail if found guilty.

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