Priority 1: Criminalize the corrupt sell-off of land and resources by politicians
“A suitcase full of cash might take a bupati down. But a wire transfer of millions, via a family member, could be clean” explain investigative journalists from The Gecko Project in The secret deal to destroy paradise.
Bupatis, or district chiefs, when elected, can allegedly use their influence to provide wealthy investors access to government contracts or permits. In a recent KPK survey, the KPK has found that the cost of winning a district level election was estimated at up to US$2 million. The survey also highlighted that while 35% of respondents shared that they spend more on campaigns than they are actually able to, 71% acknowledged that the donators expected something in return- in most cases business permits and licenses.
On March 29, in an allegation of a scheme to buy votes in the coming elections reported in Tempo.co, the KPK confiscated 84 boxes of cash totalling more than $500,000, following the arrest of a party politician on an alleged suspicion that he received numerous bribes from a fertilizer distribution deal. “The suspect allegedly collected money from several sources to carry out sengaran fajar in the 2019 elections” said the KPK Deputy Head. Photo@KPK2019
Around 60% of cases today handled by KPK are related to politics. Beyond proving actual cash bribes, another challenge for prosecutors today is that “natural resource conglomerates have also been found to use complex, albeit legal, tax structures to expand their operations in Indonesia”, as per the investigation from International Consortium of Investigative Journalists’ “Paradise Papers”. According to investigations by Mongabay and The Gecko Project, there is a risk that politicians use elaborate schemes with shell companies and proxy owners to sell oil palm plantation permits to some of the world’s largest firms.
"We are constantly facing cases of trading in influence for money or benefits, but we can’t prosecute these cases as such, as it is not criminalized in our law ”, Mr. Laode M. Syarif, KPK Deputy Chairman, speaking at the event
"Criminalizing trading in influence (UNCAC Art. 18) is a priority for Indonesia. It would bring tools for investigators to capture all aspects of undue influence in corruption cases" explained Mr. Francesco Checchi, UNODC Regional Adviser on Anti-Corruption
Priority 2: Account for environmental damages and social costs of corruption
According to Indonesia’s Anti-Corruption Law, if a suspect has not been caught with sufficient evidence of corruption, investigative agencies, in order to go ahead with a case, must show the allegedly corrupt act resulted in ‘state losses’ of more than US$70,000.
The severity of the charges relies on the estimated ‘state losses’, which are for instance calculated based on the lost royalties and payments from illegal activities. Between 2008 and 2014, the KPK estimated that 77-81% of the timber taken from Indonesia forests was not reported to the State, resulting in $6.5 billion of state losses of revenue.
When companies do pay taxes but falsify their activities, what are the costs? The KPK has developed calculations to identify environmental damages and social costs of corruption since 2009, but the legal basis often make convictions uncertain, as reported by several experts during the seminar.