October 06, 2010

http://www.thejakartaglobe.com/home/given-sharper-teeth-kpk-raring-to-use-new-powers-in-battle-against-money-laundering/400001

Jakarta. The Corruption Eradication Commission said on Wednesday it was ready to investigate money- laundering cases after the House of Representatives passed a revised Anti-Money Laundering Law that gives anticorruption officials more power to tackle graft.

Antigraft activists said the new law contained two critical points: ending the National Police’s monopoly on probing money laundering and ensuring other law enforcers automatically receive reports from the Financial Transaction Report and Analysis Center (PPATK).

The law says reports on illicit transactions and indications of money laundering by the PPATK will be forwarded to the National Police, the Attorney General’s Office, the Taxation Office, the National Narcotics Agency (BNN), the National Intelligence Agency (BIN) and the antigraft commission, also known as the KPK, depending on the types of crimes.

“There are a lot of cases of corruption that also contain indications of money laundering,” KPK deputy chairman Bibit Samad Rianto said.

“Previously we only had the authority to investigate the corruption charges, while allegations of money laundering were sent to the National Police.”

He said the KPK would visit its counterparts in other countries such as Australia, China and Britain that had been successful in investigating corruption and money laundering.

Bibit said the agency had already scheduled to visit Macau from Nov. 2 to 3.

Indonesian Corruption Watch chairman Danang Widoyono said the KPK now had a new arsenal, and the law also allowed the KPK to deploy another tactic – to follow the money trail – when investigating corruption.

“Previously the KPK relied heavily on witnesses’ remarks and dossiers, which could be time-consuming,” Danang said.

“With the law enacted, illicit transactions can be automatically detected by the KPK the minute they occur. It is like catching corrupt officials red-handed.”

But Danang said the law still left room for improvement, particularly after the House rejected the government’s proposal to allow the PPATK to conduct its own investigations.

“Because the PPATK cannot conduct its own investigations, the KPK has to start from scratch when handling a corruption case because the PPATK report has no legal standing in a court of law,” he said.

Teten Masduki, secretary general of Transparency International Indonesia, applauded the lawmakers’ decision to preserve much of the proposed bill amid speculation that the House, long considered as one of the most corrupt institutions in the country, was trying to undermine the fight against corruption.

“It is a big step and this will enable the KPK to bring down corrupt officials by tracing their financial transactions,” he said.

Teten said the PPATK reports have been useless in the hands of the National Police.

The agency has detected 2,442 suspicious transactions since it was set up in 2004, 92 percent of which were forwarded to the National Police and the rest to the prosecutors’ office. Only 26 cases ended in convictions.

In the only two cases where the KPK was authorized to use PPATK reports, 36 lawmakers ended up being charged, 10 of whom were found guilty, while the rest are still under investigation.

Teten highlighted the failure of the National Police and the AGO to successfully prosecute former tax official Gayus Tambunan, who the PPATK found had a huge bank account.

Gayus later admitted to bribing police and prosecutors in exchange for building a weaker case against him.

Police are also under fire for inaction on a PPATK report that identified 23 top officers as having suspiciously large bank accounts.

Police said only two allegedly received funds from illegal sources — an ousted officer in Papua who has been convicted of a crime and detained former chief detective Susno Duadji.

The rest supposedly became wealthy through businesses or an inheritance.