OPENING REMARKS & KEYNOTE SPEECH

Mr Adnan Pandu Praja *

The honorable:

Mr Kozo Honsei, Deputy Chief of Mission at the Embassy of Japan,

Mr Taro Morinaga, Deputy Director of the United Nations Asia and Far East Institute
for the Prevention of Crime and the Treatment of Offenders,

Ms Laksmi, Acting Head of the Legal and International Relations Bureau at the
Attorney General’s Office,

Our visiting expert Mr Tony Kwok, former Deputy Commissioner of ICAC Hong
Kong,

Mr Da’i Bachtiar from the Indonesia Crime Prevention Foundation,

Distinguished participants of the seminar from fellow countries in Southeast Asia,

And esteemed colleagues from the National Police, the INTRAC, Financial Services
Authority, Ministry of Finance, Ministry of Foreign Affairs and Ministry of Law and
Human Rights.

Assalamu’alaikum wa rahmatullahi wa barakatuh, and good morning to all.

On behalf of the Corruption Eradication Commission, I would like to welcome you to

the Ninth Regional Seminar on Good Governance for Southeast Asian Countries. In the past
years, our Commission has benefited from the wealth of knowledge shared during the
previous seminar sessions. Thus, I am very happy that this year we, in cooperation with
UNAFEI and the Attorney General’s Office, have the privilege of hosting it here in Indonesia.
My heartfelt thanks to the staff at UNAFEI, AGO, and also KPK for all the work done in
preparing and organizing the seminar.

Ladies and Gentlemen,

Here, we come from different backgrounds, from various countries with differing legal
systems, from the same country but different institutions, carrying out different functions.
However, I believe that we share something in common, a desire to learn from one another
and to stay up-to-date on how we can accomplish our mandates in order to tackle the problem
that is corruption. We all know the harms of corruption, and that it needs to be stamped down.
To do that, it is important that we identify the current situation and challenges in the field, in
order to formulate the best and feasible strategies to overcome them.

*
Vice Chairman, Corruption Eradication Commission of the Republic of Indonesia.

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 I. SOPHISTICATED METHODS

With regard to corruption, some aspects of it remain constant, namely the presence of
authority and the abuse of it for personal gain. However, it is not the case with the methods
used. At the popular level, people may think of corruption as the straightforward giving and
taking of bribes linked to an official’s act in favor of the briber, or the manipulation of
records in order to embezzle money from the state budget. Yet, practitioners know that
increasingly complex and sophisticated measures have been used in order to obscure corrupt
deeds and hide the proceeds of crime.

An example that we notice is the trend of the corruptive state budgeting cycle. In
Indonesia’s decentralized system, there are two kinds of state budget, the central government
budget or APBN, and the regional government budget or APBD. The trend is for corruption
to start during the planning stage, when marked up goods and services procurement, with
prices above the official general cost standards without sufficient explanation, are embedded
in the APBD. If the marked up projects get approved by the local Parliament, often there are
already “backers” from within local legislators. By the time the project is implemented, the
actual funds used for the goods and services is just a fraction of what’s proposed. The next
year, when audited by the Supreme Audit Board, the project becomes a finding, which is
grounds for interpellation by the local Parliament. Yet instead, it passes the local Parliament
easily, which suggests that here too, is a point of risk of collusion or extortion between
executive and legislative. The corruptive budgeting cycle can be prevented if the regional
inspectorates and the people are involved in transparent and participatory budgeting from the
beginning to ensure that the state budget appropriately meets the people’s needs.

Another example of methods involves layering of transactions associated with money

laundering, with the use of gatekeepers and also shell companies that are sometimes located
overseas. With regard to anticipating gatekeepers, this year a Government Regulation 1 has
been issued, making it obligatory for professions often associated with gatekeeper activity
such as accountants, advocates, notary public and financial service providers to report
suspicious transactions to the INTRAC.

In general, to anticipate such methods, law enforcement agencies need to stay current
and share information as well as lessons learned from cases on the ground.

II. ASSET TRACING

Another area of challenge encountered during investigation and prosecution is

regarding asset tracing, especially when it involves the jurisdiction of another country. The
procedure, including the use of MLA, can take up a long time, especially as it involves the
need to understand a different set of rules. Through experience, good communications built
upon a well-maintained cooperative relationship helps during the formal and informal
coordination to facilitate the process between the requesting and requested countries.

1
Peraturan Pemerintah (Government Regulation) number 43 year 2015.

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 With regard to asset recovery especially, earlier this month in the 6th Conference of the
States Parties to the UNCAC in Saint Petersburg, state parties have agreed to begin the
second review cycle covering Prevention and Asset Recovery in the next year. I look forward
to the implementation review mechanism to foster compliance with articles 51 to 59 among
ratifying countries so as to assist efforts in recovering the proceeds of corruption.

III. RESOURCE BALANCING

Going back to the national context, our institutional challenge. Our country Indonesia’s
territory spans almost 2 million square kilometers of land, with a population of roughly 250
million. Our civil servants number at around 4.3 million. Meanwhile the KPK currently has
around 1200 employees, of which less than 200 are investigators or prosecutors. Striking a
balance between the needs for quantity of law enforcement personnel and ensuring they have
the appropriate qualifications and capability is a challenge for management.

Likewise, in terms of facilities such as the availability of examination rooms, resources

needed for site visits in remote areas. One proposal that we are exploring, which is allowable
by the KPK Law but still needs to be agreed upon by the Parliament, is to set up provincial
branches. Another proposed measure is to improve the effectiveness of KPK’s coordination
and supervision role through an electronic mechanism, what I’d call e-korsup. The
framework for this mechanism would include real-time notice of the starting and progress of
a case investigation. It can also allow us to gather data on the distribution and typology of
corruption throughout the country as a basis for planning and policy-making.

IV. INTERPRETATION OF LAW

Another challenge we face is in the area of interpretation of laws. In Indonesia’s legal

system based on civil law, judges decide on cases based on code provisions on a case-by-case
basis, independent of precedence. In practice, this may cause confusion when the law is
vaguely worded, or in the presence of contradictory regulation, or not well-adapted to recent
advances, such as the increasing sophistication of criminal methods mentioned earlier.
Different judges may rule differently on the same thing, such as the validity of investigations
conducted by KPK independent investigators, who are not seconded from the Police Force or
the Attorney General’s Office.

During the period from 2000 to 2015, the government has issued 12, 471 regulations 2,
most of which are ministerial level regulations, around 8400 of those, followed by
presidential level regulations, as well as 916 bills.

Regarding bills, a concerning trend is the increase of judicial review at the

Constitutional Court. From 2003 to 2015, the Constitutional Court has ruled in favor of 182
judicial review requests 3, including one that allows the pre-trial mechanism to challenge the
validity of designation of suspects. This ruling has become an extra step for suspects to seek

2
Strategi Nasional Reformasi Regulasi: Mewujudkan Regulasi yang Sederhana dan Tertib. Kementerian
PPN/Bappenas, 2015.
3
See <http://www.mahkamahkonstitusi.go.id/index.php?page=web.RekapPUU>.

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revocation through the decision of a single judge while investigation is ongoing, which in
turn changed the way law enforcement officers work.

Another indicator is from the 2013 Worldwide Governance Indicators, which scored
the regulatory quality in Indonesia at 46 per cent.

A concerted effort involving lawmakers—in this case the legislative and executive
branch of the government—is needed in order to improve the quality of regulations. On that
front, I appreciate that the Ministry of Development Planning has launched the National
Strategy for Regulation Reform covering the period of 2015 to 2025, and hope that it is a sign
of political will to achieve not only deregulation that leads to ease of business but also good
governance.

On the practitioner's side, we also try to tackle this challenge by coordination efforts,
including joint trainings to harmonize the views between investigators, prosecutors and
judges, for example the recent Judge’s Dialogue series on Anti Money Laundering and
Criminal Asset Confiscation.

V. KPK’s ACTIVITY IN INTERNATIONAL COOPERATION

During a two-day conference of the world’s anti-corruption institutions held by KPK in

2012, the participants jointly drafted the Jakarta Principles—16 rules to reinforce anti-
corruption institutions in the world. In the same year, the Southeast Asia Parties Against
Corruption (SEAPAC) workshop strengthened the strategic commitment among Southeast
Asian countries to restrict the movement of corruptors.

In 2013 through the Asia Pacific Economic (APEC) forum that has wider reach, KPK
as host of the Anti Corruption and Transparency Working Group (ACTWG) was initiated the
APEC Anti-Corruption Network (ACT-Net), a cooperation forum between anti-corruption
agencies in APEC countries. KPK felt that the establishment of such networks is important
given Indonesia’s experience. A number of corruptors have escaped abroad to avoid criminal
sentences, and assets from corruption have also been stacked in other countries, complicating
the issue. With ACT-Net, the issues related to jurisdiction, citizenship and dual criminality
could be settled more easily.

KPK also initiated the formation of the Economic Crime Agency Network (ECAN).
The network consists of law enforcement agencies in various countries, such as the FBI from
the United States, Singapore’s CPIB, Malaysia’s MACC, the United Kingdom’s SFO, OLAF
in the European Union, and the SFO New Zealand. The cooperation helps provide data and
information required in corruption investigation.

Ladies and Gentlemen,

The revitalization of the anti-corruption movement in Indonesia in the post-1998 era

has come to an important juncture, where it’s time to evaluate what works, what needs to be
strengthened, and what needs to be adjusted, while avoiding the pitfalls of overlooking long-
term efforts. We also learn from the history of steadfastness of the anti-corruption authorities
in our fellow countries, like in the 38 years of ICAC Hong Kong, 48 years since the Malaysia
ACA—now MACC, 63 years of CPIB Singapore, all with their ups and downs.

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 Lastly, I wish you a successful and beneficial seminar, and good times in Indonesia
especially to those who are here the first time. May we all bring from here not only
knowledge, but also better rapport upon which effective communication and cooperation
shall be built.

Thank you, wassalamu’alaikum wa rahmatullahi wa barakatuhu.

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