The central bank has revealed some details of the fit-and-proper tests taken by top executives from Citibank Indonesia, and the results do not look good.
“There are a few directors who did not pass the test,” Endang Sedyadi, Bank Indonesia’s director of bank supervision, who oversees foreign and joint venture banks, said on Tuesday without releasing names.
Seven Citibank executives were ordered to take fit-and-proper tests in early May as part of Bank Indonesia’s string of measures to respond to two banking scandals: an embezzlement case allegedly involving Citibank employees and the death of a credit card customer, allegedly at the hands of its debt collectors.
“Those who failed the evaluations cannot work as bankers in the Indonesian banking system for at least three years, depending on their individual results,” Endang said.
She said Bank Indonesia concluded its tests in early June and had already notified Citibank, with all executives having the chance to respond.
“Naturally, the ones who failed the test objected to the results,” she said, adding that an appeal could be filed.
The fate of the affected executives will be officially announced within 40 days, she added.
Endang said the face-to-face interviews and tests assessed 10 key aspects, including integrity and competence. The central bank found that most of the directors taking the test had neglected Citibank’s internal procedures.
“They have their own standard operating procedures, besides the basic regulations issued by Bank Indonesia,” she said, “but, apparently, most of them neglected to use it.”
The Indonesian unit of the US lender was at the center of a media storm this year after news broke of an embezzlement scandal involving its priority banking business.
A Citibank relationship manager at its Landmark branch office, Inong Malinda Dee, 47, was accused in March of embezzling millions of dollars from wealthy clients. Later that month, a heavily indebted credit card customer, Irzen Octa, secretary general of the National Unifying Party (PPB), mysteriously died at the bank’s office at Menara Jamsostek in South Jakarta after meeting with debt collectors hired by Citibank.
Media reports had identified three of the seven executives tested — former country officer Shariq Mukhtar, compliance director
Jessica Effendi and former compliance director Aryoatmodjo Mirah, who is now employed at Bank Permata. The others have only been identified as Citibank’s senior operating officer for Indonesia, a retail banking head, a billing head and the Landmark branch office head.
Bank Indonesia has imposed a two-year freeze on Citibank acquiring new credit card customers and a one-year suspension on acquiring new priority banking customers.