Indonesia's Speaker named suspect in $230m graft case

Indonesia's Speaker Setya Novanto denied graft accusations at a press conference in Parliament, in Jakarta, yesterday.
Indonesia's Speaker Setya Novanto denied graft accusations at a press conference in Parliament, in Jakarta, yesterday.PHOTO: EUROPEAN PRESSPHOTO AGENCY

Golkar chairman is 4th person to be implicated in case involving govt funds

JAKARTA • Indonesia's anti-corruption agency has named the country's Speaker of Parliament as a suspect in a major graft scandal which is estimated to have siphoned around US$170 million (S$230 million) out of government coffers.

The Corruption Eradication Commission, or KPK, named House Speaker Setya Novanto as a suspect late on Monday in the giant graft case that has also implicated other senior politicians, including the Justice Minister, former interior minister and several governors.

Commission head Agus Rahardjo said Mr Novanto "allegedly abused his authority and position for personal gain or for the interest of a corporation".

Investigators allege that Mr Novanto was among many politicians who received kickbacks from funds earmarked for a government project to issue new identification cards, called e-KTP, to the country's 255 million inhabitants.

"The accusations are all untrue," Mr Novanto, who is also Golkar party chairman, told a press conference yesterday.

Ms Nurul Arifin, a spokesman for Golkar, said: "The Golkar party follows and respects the process of upholding the law, and we strongly hold on to the principle of the presumption of innocence."

She said the ruling coalition party was still waiting to receive the official notice from KPK.

  • Novanto's earlier case

  • Mr Setya Novanto, 61, is chairman of Golkar, the second biggest party in Parliament after President Joko Widodo's Indonesian Democratic Party of Struggle (PDI-P).

    Mr Novanto was appointed Speaker in 2014.

    In 2015, he was accused of trying to extort US$1.8 billion (S$2.5 billion) worth of shares from the Indonesian unit of US mining giant Freeport McMoran. He denied the allegations.

    Indonesia's Attorney-General later dropped an investigation, the constitutional court ruled in favour of Mr Novanto, and Parliament's ethics panel also cleared him in the case.

    He stepped down from the Speaker's post in December 2015 following the scandal, but was reappointed last November after he became Golkar's chairman in May last year.

Indonesia's special anti-corruption court has said that more than one-third of the 5.9 trillion rupiah (S$606 million) fund was embezzled by a network of politicians and businessmen in a scheme that allegedly ran from 2009 to 2015.

KPK has been investigating allegations that sums ranging from US$5,000 to US$5.5 million - money generated by marking up the costs of the e-KTP procurement - were divided up in a room in Parliament.

Mr Novanto is the fourth suspect announced in the case, which could turn into a test of President Joko Widodo's willingness to take a tough stance against corruption since many of those implicated are government officials.

KPK's large-scale investigation, which implicates members of Mr Joko's ruling party - the Indonesian Democratic Party of Struggle (PDI-P) - and other parties in his coalition, shows the independence of the anti-corruption agency, political analysts say.

"This most certainly demonstrates how tough KPK is," Mr Keith Loveard, a Jakarta-based analyst at Concord Consulting, said, adding that Mr Joko is unlikely to get in the way of KPK's investigation in the e-KTP case.

"While all the parties are virtually implicated, including the PDI-P, public support for KPK remains extremely high," Mr Loveard said.

Mr Novanto was previously named a suspect in another corruption case, which forced him to quit as Speaker in 2015, when he was accused of extorting a stake from United States mining giant Freeport-McMoRan in exchange for extending the company's right to operate in the archipelago.

He was cleared of the allegations and reappointed as Speaker last year.

Indonesia was ranked 90th out of 176 countries and territories in NGO Transparency International's Corruption Perceptions Index last year.

A No. 1 ranking represents the least corrupt country.


A version of this article appeared in the print edition of The Straits Times on July 19, 2017, with the headline 'Indonesia's Speaker named suspect in $230m graft case'. Print Edition | Subscribe