Former PTPN XI Boss Named Suspect in Assembagoes Sugar Factory Modernisation Corruption Case
The Corruption Eradication Corps of the Indonesian National Police has named two individuals as suspects in an investigation into alleged corruption related to the integrated Engineering, Procurement, Construction and Commissioning (EPCC) work for the development and modernisation of the Assembagoes Sugar Factory in Situbondo Regency, under PT Perkebunan Nusantara (PTPN) XI for the 2016-2022 period. The state is alleged to have suffered financial losses amounting to Rp645,267,475,745 in this case.
Head of Operations for Kortastipidkor Polri, Senior Commissioner Ahmad Yusuf Afandi, explained that the project was part of a national strategic programme aimed at increasing national sugar production capacity and supporting food security through State Capital Participation (PMN). However, the investigation found alleged irregularities from the planning stage through to the procurement process and project execution.
Investigators discovered structured actions to direct the tender process to a specific company, even though the company did not meet the specified requirements. Payments to the project executor had reached approximately 99.3 percent of the contract value, yet the work results failed to meet the performance targets stipulated in the contract, leading to state financial losses based on an investigative audit.
During the investigation, 93 witnesses and three experts were examined, including a state loss calculation expert, a procurement expert from the National Public Procurement Agency (LKPP), and an EPCC expert. Investigators also conducted searches at four locations and seized various related documents and electronic devices.
Based on sufficient evidence, two suspects were named on 2 July 2026: DPP, who served as President Director of PTPN XI from 2015 to 2017, and TD, the Director of PT Multinas Indonesia. DPP is suspected of rigging the procurement process by approving a company that did not meet the requirements, directing consortium needs, and inflating the Owner’s Estimate (HPS) without adequate technical basis to benefit certain parties. TD is suspected of executing work that did not conform to the contract, failing to involve the technology provider from the planning stage as required, and neglecting the obligation to issue a performance guarantee, resulting in the commissioning process not being carried out according to regulations.
Both suspects are charged under Article 2 paragraph (1) and/or Article 3 of Law Number 31 of 1999 as amended by Law Number 20 of 2001 concerning the Eradication of Criminal Acts of Corruption. The police emphasised that the investigation will continue to uncover other responsible parties and to optimise efforts to recover state financial losses through asset tracing and coordination with public prosecutors.