Notary's Responsibility for Providing Covernotes in Bank Credits that Result in Losses for Banking Institutions

Abstract

Abstract. Indonesia, as a country based on the rule of law, places notaries as key officials in providing legal certainty through authentic deeds, in accordance with the UUJN (National Law). In banking practice, notaries often issue covernotes as a certificate of progress in processing credit guarantees. Although not an authentic deed, covernotes serve as a basis for bank trust in credit disbursement, supported by the principles of trust and freedom of contract. However, the unclear regulations regarding covernotes have implications for the potential legal liability of notaries. If a bank suffers losses due to the notary's negligence or default in the covernote, the notary can be held liable for civil damages and administrative sanctions. Notaries are required to act carefully and professionally when issuing covernotes. This research uses a normative legal method with an approachstatute approach and analytical approachThe data used are secondary data covering primary, secondary, and tertiary legal materials. Data analysis was conducted prescriptively. The conclusion of this study identifies factors that contribute to bank losses due to notary cover notes. From a legal perspective, cover notes do not have the binding legal force of an authentic deed and are not explicitly regulated, creating uncertainty. Technically, banks rely too heavily on cover notes, making them vulnerable to the risk of problematic collateral. Professional ethics open up opportunities for abuse. Notaries bear significant responsibility for bank losses in civil, criminal, and ethical/disciplinary matters. Risk mitigation requires notaries to exercise caution in issuing cover notes, as well as careful examination, verification, transparent communication, and strengthening internal procedures by banks. Keywords: Bank Credit; Covernote; Notary Responsibility.