Int'l help needed to fight money laundering
Rita A.Widiadana, The Jakarta Post, Nusa Dua, Bali
Indonesian Minister of Justice and Human Rights Yusril Ihza Mahendra said on Wednesday the country needed help from its neighboring countries as well as international organizations to fight money laundering and terrorist financing.
Speaking after the closing of the two-day conference on combating money laundering and terrorist financing, Yusril was outspoken in referring directly to Singapore, which he said persistently refused to sign an extradition agreement with Indonesia. Indonesia's push for the extradition agreement was part of an attempt to bring to court a number of Indonesian citizens suspected of committing economic crimes and hoarding their savings in various financial institutions in the city- state.
He said if the extradition agreement had been signed, Indonesia would have been able to reclaim some of the money from the accounts of those who had received Indonesian Bank Liquidity Assistance Funds (BLBI), which amounted to around Rp 180 trillion (US$200 billion).
"If we succeed in reclaiming these funds, we wouldn't have to beg for assistance from the International Monetary Fund (IMF), for instance, or from other international financial institutions to support our economy," he added.
During their summit on Monday, both President Megawati Soekarnoputri and Singaporean Prime Minister Goh Chok Tong did not touch the extradition issue.
Through the conference, Yusril said, Indonesia obtained strong commitment and help from a number of participating countries and institutions, including the United States, Australia, the Asian Development Bank (ADB) and various others.
"The United States has shown its strong commitment to help Indonesia by providing training assistance and other capacity building activities to the Indonesian police and the Indonesian Armed Forces (TNI) to fight against terrorism and related crimes," he said.
Indonesia, the minister added, had just obtained legislation on the issue only in April this year but had yet to build a comprehensive system or institutions to fight money laundering, corruption and related economic crimes.
The law on money laundering, which was passed in order to comply with international commitments, covers 15 predicated crimes including money laundering, terrorism and punishable criminal acts such as corruption, bribery, smuggling of goods, smuggling of immigrants, banking offenses, related drug crimes and trade in women and children.
The minister went on to say that Indonesia would also ask the U.S. and other countries to help Indonesia in investigating money illegally swindled from the Indonesian Central Bank through sharing information and expertise.
"We have to admit that Indonesia must learn a lot from more experienced countries in dealing with money laundering and terrorism financing," Yusril said. For example, he said, the transfer of $30,000 from a Malaysian bank to Indonesia to finance the recent Bali bombing went undetected by the Central Bank.
"The amount of money was insignificant as compared to the impact caused by the Bali bombing since, as a result, the government must now revise the state budget. The country also suffered a loss of billions of dollars due to the bombings in Bali and in Makassar, South Sulawesi, in early December," he said.
Another important point is that it is extremely difficult to detect money-laundering activities through informal financial institutions.
"Many people allegedly involved in this crime often spend their money in cash. Therefore, we really need a strong legal and law enforcement system to deal with this problem," he said.
In addition to these forms of assistance, the ADB has pledged to provide $650,000 in technical assistance to help a number of countries in the Asia-Pacific, including Indonesia, the Philippines and Thailand, to counter money laundering activities in the region.
The two-day conference, which was co-hosted by Indonesia and Australia, has resulted in a number of conclusions and action plans.
The conference stressed three important issues: building legislative frameworks and networks to combat money laundering and terrorist financing among participating countries, and increasing capacity building activities, close cooperation and coordination.
Australian co-chairman Chris Moraitis said the results of the conference were not merely static statements. "The conference brought together experts on money laundering from all over the world to share their expertise with their counterparts from the Asia-Pacific countries," said Moraitis, who is a senior legal advisor of Australia's foreign affairs ministry.
The conference participants recognized the importance of combating money laundering within the framework of their domestic laws and international obligations, and of enacting the appropriate legislation to combat money laundering.
Participants acknowledged that money laundering was a transnational crime which could involve many countries. Therefore, they expressed their strong commitment and intent to forge cooperation to furthering existing instruments and efforts aimed at strengthening the capacity of states to respond, collectively and individually, to the threats posed by money laundering and terrorist financing.
The conference also underlined the importance of strengthening existing mechanisms in the Asia-Pacific region to prevent, criminalize and combat money laundering. Mutual legal assistance among the participating countries would cover the investigation and prosecution of money laundering and terrorist financing, the tracing, freezing and confiscation of proceeds of crimes and of funds destined for terrorist sources.