House approves money laundering legislation<\/p>\n
Dadan Wijaksana, The Jakarta Post, Jakarta<\/p>\n
The House of Representatives passed a bill on money laundering
\ninto law on Monday, signaling the country's commitment to
\nfighting the practice and shedding its image as a haven for money
\nlaundering.<\/p>\n
Minister of Justice and Human Rights Yusril Ihza Mahendra said
\nthe importance of the law was such that its passage could win
\nIndonesia wider support from the international community.<\/p>\n
\"With this (law), hopefully we can be regarded as cooperative
\n(in curbing money laundering),\" Yusril told reporters after a
\nplenary session of the House to pass the bill.<\/p>\n
Although there is insufficient data on the scope of money
\nlaundering activities here, Indonesia has long been regarded as a
\nhaven for the practice.<\/p>\n
Given the fact that Indonesia is known as one of the world's
\nmost corrupt nations, there has to be money laundering occurring
\nin the country to legalize ill-gotten fortunes, Yusril said.<\/p>\n
Money laundering is the practice of converting money generated
\nfrom corruption, bribery, smuggling, banking-related crimes,
\ndrug-related crimes, human trafficking, gambling and terrorism
\ninto legal investments. Such activities flourish in developing
\nnations, which often lack the regulations and laws to fight the
\npractice.<\/p>\n
The enactment of the law comes at a crucial time, with the
\ngovernment meeting with the Paris Club of creditor nations next
\nmonth to seek the rescheduling of some US$5.5 billion in
\nsovereign debts maturing in 2002 and 2003.<\/p>\n
The rescheduling of the debts, both the principals and the
\ninterest, is critical in helping to limit the 2002 state budget
\ndeficit at a safe level of 2.5 percent of gross domestic product.<\/p>\n
The foreign creditor nations of the Paris Club have demanded
\nthat Indonesia have a money laundering law on the books as one of
\nthe conditions for a rescheduling facility.<\/p>\n
The passage of the money laundering bill also comes ahead of
\nthe Paris-based Financial Action Task Force (FATF) meeting in
\nJune, which will evaluate the performance of countries in curbing
\nmoney laundering activities.<\/p>\n
FATF, a global task force set up in 1989 under the auspices of
\nthe Organization for Economic Corporation and Development, has
\nplaced Indonesia, along with several other countries, on its
\nblacklist of counties deemed \"uncooperative\" in fighting money
\nlaundering.<\/p>\n
Inclusion on FATF's blacklist has serious consequences. Among
\nthe steps that task-force member governments can take against
\nblacklisted countries are: warning multinational corporations
\naway from doing business in those countries; forcing banks to
\ncollect detailed information before conducting transactions with
\ncitizens or companies in those countries; and making it more
\ndifficult for banks based in those countries to operate overseas.<\/p>\n
Indonesia's newly approved 34-page money laundering law
\ncontains 10 chapters and 52 articles, most of which outline
\nmeasures to control attempts to hide illegally amassed funds.<\/p>\n
Those convicted of money laundering will be subject to between
\nfive years and 15 years in jail, plus between Rp 5 billion (about
\nUS$510,000) and Rp 15 billion in fines.<\/p>\n
The new law states that financial institutions (banks) must
\nreport to the authorities if they uncover any suspicious
\ntransactions involving at least Rp 500 million.<\/p>\n
Indonesian residents who either bring in or take out of the
\ncountry Rp 100 million in cash must report the money to the
\ncustoms office.<\/p>\n
The new law also will become a legal basis for the
\nestablishment of the independent Financial Transaction and Report
\nAnalysis Center (PPATK).<\/p>\n
PPATK will be in charge of analyzing and investigating
\nreported suspicious transactions, as well as individuals and
\nfinancial institutions who fail to report suspicious financial
\ntransactions.<\/p>\n
The crimes covered by the law are so diverse as to include
\nmoney amassed through almost all illegal activities.<\/p>\n
The law covers proceeds not only from corruption and drug
\ntrafficking, but also from a wide range of other crimes,
\nincluding smuggling, bribery, banking crimes, crimes related to
\npsychotropic substances, terrorism, the slave trade and the
\ntrafficking of women and children, gun trafficking, fraud,
\nkidnapping and theft.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/house-approves-money-laundering-legislation-1447893297",
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"sponsor": "Okusi Associates",
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