The case involves allegedly illegal payments by Bank Indonesia to rogue MPs via third-party non-profit foundations in the name of social aid. - Photo: Reuters
JAKARTA: Corruption in Indonesia has become “chronic and sophisticated”, say analysts, as the nation’s anti-graft agency, KPK, intensifies a probe into the central bank for allegedly misusing its social aid funds to benefit certain MPs.
The case centres on allegedly illegal payments by Bank Indonesia (BI) to MPs via third-party non-profit foundations in the name of social aid, an act that analysts see as currying favour with influential lawmakers.
The central bank has defended itself, saying it operated within the law and that institutions are allowed to hand out social aid via foundations.
KPK told reporters on Dec 17 that it had begun the investigation several months ago.
Asep Guntur Rahayu, KPK’s director of investigation, said on Thursday (Jan 2) that the agency is looking into the possibility that the foundations receiving funds from BI are not independent or that they are affiliated with certain MPs.
“An MP might have recommended a certain foundation (to the central bank), or the MP himself runs the foundation that he recommended,” he said.
Public policy expert Trubus Rahardiansyah told The Straits Times that the BI case is just the tip of the iceberg, saying that corruption in Indonesia has become more entrenched and sophisticated.
“The objective is to influence lawmakers and weaken their control... There are usually ‘playmakers’ – those who are most vocal and influential – in each parliamentary committee. So institutions that come under the purview of these committees have a vested interest in cultivating certain lawmakers if they want to achieve a particular outcome,” Dr Trubus said.
“The corruption problem has reached a chronic level in Indonesia, and it takes strong guts to fight it.”
Indonesia’s Parliament has 13 committees overseeing sectors such as finance, energy, security and health.
So far, KPK has questioned two members of the parliamentary finance committee that oversees BI, namely Satori, from the National Democrat party, and Heri Gunawan, from the ruling Gerindra party.
The finance committee comprises 45 MPs from all eight national political parties.
“The (social aid) was given to all members of the finance committee... It’s not only given to the two of us. It’s for the social programmes in our respective electoral districts,” Satori told media on Dec 27, referring to an MP’s regular meet-ups with constituents.
The ongoing investigation is the third case involving graft at the central bank.
In 2003, BI channelled funds totalling 31.5 billion rupiah (S$2.6 million) to several MPs in the finance committee ahead of deliberation of an amendment to a central bank law. Scores of governors on BI’s board and MPs were convicted and jailed for graft as a result.
A year later, 30 MPs were jailed for receiving travellers’ cheques as bribes to support the election of Dr Miranda Goeltom as Bank Indonesia’s senior deputy governor.
Between 2004 and mid-2023, there were 344 corruption cases involving national MPs and other political representatives across Indonesia, according to KPK.
One high-profile case involved then Parliament Speaker Setya Novanto, who was jailed for 15 years in 2018 for receiving US$7.3 million (S$10 million) in kickbacks and bribes linked to the national roll-out of government ID cards.
BI governor Perry Warjiyo said on Dec 18 that the central bank will cooperate in the investigation and stressed that the bank disbursed social aid only to legal foundations that showed concrete plans for the use of the money.
“There are also checks and accountability reports produced by the foundations. A task force handles this at BI headquarters (in Jakarta), as well as branches (across Indonesia),” Dr Perry said.
Anti-graft observer Saut Situmorang, a former intelligence officer at Indonesia’s intelligence unit, BIN, who was a KPK commissioner from 2015 to 2019, questioned the central bank’s involvement in social aid activities.
“Central banks in other countries, such as the US Federal Reserve, do not do social aid. Bank Indonesia should focus on managing monetary policies and rupiah exchange rates,” said Saut. - The Straits Times/ANN
