He’s still moving
Supreme Court verdict
reflects a search for the tip of a melted iceberg
More
than 17 years after the Indonesian strongman Suharto fell and more than seven
years after his death, the family probably retains enough clout in Jakarta to
defy a Supreme Court ruling that they must repay about $325 million gained from
massive corruption during his years in power.
Even that amount is a tiny fraction of what the Suharto family is
believed to have stolen. Successive governments have half-heartedly tried to
recover funds rumored to be between US$15 billion and US$35 billion. After he
died at the age of 86 in 2008, authorities made little effort to go after his
six super-rich children, all of whom benefited from government contracts and
easy finances. They remain fabulously wealthy and retain significant economic
power, with Suharto’s daughter Siti Hediati Harijadi, known as Titiek, a Golkar
Party member of parliament. Hutomo “Tommy” Mandala Putri, the youngest son,
controls Humpuss group of companies, which has interests in energy, coal,
petrochemicals and transport, while he also owns several resorts in Bali.
The other children also control significant interests in the country and
overseas.
W. Paul Rowland, a Jakarta-based associate with the Center for
Democratic Institutions at Australian National University, says it’s unlikely
the money will be repaid although he does say the ruling’s potential
significance lies in the fact that the Suharto family may be losing its
impunity after 17 years.
Thus the ruling is a very small win for President Joko ‘Jokowi’ Widodo,
who came to power last year on promises to fight corruption but has since
failed to stop sustained attacks by police against the country’s respected
anti-corruption watchdog.
Tommy claimed on his Twitter account that the Supreme Court’s July 8
decision that an education foundation set up by Suharto should repay US$315
million plus Rp139.2 billion ($10.09 million) was an act of vengeance.
Was it really a settling of old scores against the Suharto clan by
Jokowi’s political patron, former president Megawati Sukarnoputri, whose
father, founder and President Sukarno, was ousted by Suharto? Probably not.
Hendrajit, the executive director of the Jakarta-based Global Future
Institute, says the Suharto family and cronies had reached deals with the
administration of former president Susilo Bambang Yudhoyono that kept them
immune from prosecution. He says the Jokowi administration is now renegotiating
those deals.
“Jokowi has no serious intention of prosecuting the Suharto children
because the main goal is just to disturb their favorable condition,” Hendrajit
said.
The case
has meandered through the courts for nearly a decade. The Supreme Court’s
ruling centered on the Supersemar Foundation, which takes its name from a
document Suharto used to formally seize power from Sukarno in 1966. The foundation
was established in 1974, ostensibly to providing scholarships to university
students. Much of its funding came from state banks, which had to submit 2.5
percent of their total income to Supersemar. State prosecutors found that
almost 84 percent of the foundation’s funds had been diverted to a bank and
private companies controlled by the Suharto clan and its cronies.
Suharto controlled six similar charitable
foundations that were used as cash cows. State prosecutors focused their
attention on Supersemar when trying to bring Suharto to trial for corruption,
but his lawyers and doctors argued that a series of strokes had left him
mentally disabled, so the charges were thrown out in 2000.
The Attorney General’s Office in 2007 launched
a civil lawsuit against Suharto and Supersemar, demanding compensation for the
state of US$420 million and Rp185 billion. The notoriously corrupt South
Jakarta District Court in 2008 ruled that Supersemar had embezzled funds and
should repay $105 million and Rp46 billion (US$3.9 million) – only 25 percent
of the amount sought by prosecutors.
The verdict was upheld by the Jakarta High
Court, which increased the compensation amount to US$315 million and Rp139.2
million. The Rp139.2 million figure was a typing error that should have been
Rp139.2 billion. The Supreme Court then upheld the ruling with the revised
figure.
Enforcement of the ruling is now in the hands
of South Jakarta District Court, which on Friday was still waiting to receive a
copy of the verdict. It remains to be seen who will repay the money, for which
there will be an eight-day deadline. Supersemar’s assets were already handed
over to a state ministry, the Coordinating Ministry for People’s Welfare, in
2000.
Suharto family lawyer Juan Felix Tampubolon has
questioned whether the foundation has any assets left. He said Supersemar may
have to sue some of the companies that received some its funds. Bank Duta,
which received US$420 million from the foundation, was in 2000 merged with
eight other banks to form Bank Danamon.
The former head of the Attorney General’s
Office Asset Recovery Centre, Chuck Suryosumpeno, said Suharto’s heirs will
have to bear the payment obligation. He said the court should seek assistance
from an asset recovery agency if the children do not voluntarily return the
funds. Attorney General Prasetyo said his office would seize assets once it has
a copy of the ruling and may then form a special team to examine Supersemar’s
assets.
Judges may be reluctant to order the Suharto
children to repay the money. The last judge who convicted a Suharto of
corruption was Supreme Court justice Syafiuddin Kartasasmita. In 2000, he
sentenced Tommy to 18 months in jail for corruption. Tommy went on the run and paid two hitmen to
murder the judge.
The Supreme Court cravenly responded by
overturning the corruption conviction. Tommy eventually gave himself up and
spent less than five years in jail for murder and possession of weapons. The
two hitmen received life sentences. Following his release, Tommy has expressed
political ambitions, saying he would like to lead Golkar Party, the political
vehicle used by his father. His assets make him an attractive candidate to
parties more interested in wealth than ethics. Suharto family lawyer Mohamad
Assegaf said media reports stating that Suharto’s children would have to pay
compensation were incorrect because they had not been named in the ruling.
“There was a lot of commotion over claims the heirs would have to pay. But the
Supreme Court has clarified that it is not true,” he told Kompas.com on
Wednesday.
Supreme Court spokesman Suhadi said that
although an official copy of the ruling is yet to be released, the onus of
paying the compensation lies with Supersemar and not with the Suharto children.
The children are not on the board of trustees of Supersemar.
The fact that original evidence relating the
Supersemar case disappeared while in storage at South Jakarta District Court
may further weaken efforts to regain the funds. So while the Supreme Court’s
ruling is positive, don’t be surprised if it ends up in legal limbo. Asia Sentinel
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