RI reluctantly launches money laundering agency

RI reluctantly launches money laundering agency

Dadan Wijaksana, The Jakarta Post, Jakarta

The government on Tuesday launched its long-awaited anti-money
laundering agency as part of efforts to get the country off the
developed nations' blacklist of countries that are uncooperative
in curbing the crime.

The new agency is called the Financial Transaction and Report
Analysis Center (PPATK). Its first chairman is Yunus Husein, a
senior official at Bank Indonesia.

"One of the aims for setting up the PPATK is to get Indonesia
off that list," Yunus Husein said on the sidelines of the
agency's inauguration.

He said PPATK would be in charge of analyzing and
investigating suspicious financial transactions both by
individuals and corporations.

Money laundering is the practice of converting money generated
from corruption, bribery, smuggling, banking-related crimes,
drug-related crimes, human trafficking, gambling and terrorism
into legal investments.

Most people here claim their is little evidence of money
laundering, but Indonesia has long been regarded by the
international community as a haven for criminals with dirty
money.

And despite having successfully enacted the money laundering
law in April, the Financial Action Task Force (FATF) of the
developed nations has yet to take Indonesia off its blacklist, in
what analysts believe is a result of the country's lack of
follow-up actions.

The FATF is a Paris-based global organization and was set up
in 1989, under the auspices of the Organization for Economic
Corporation and Development (OECD).

Aside from Indonesia, FATF currently has 14 other countries on
its blacklist, namely the Cook Islands, Dominica, Egypt, Grenada,
Guatemala, the Marshall Islands, Myanmar, Nauru, Nigeria, Niue,
the Philippines, Russia, St. Vincent, the Grenadines and Ukraine.

Yunus said the FATF would convene in February next year to
discuss whether or not Indonesia is eligible to be excluded from
the blacklist.

Although hopeful, Yunus was unsure that the country could
change its current status at the upcoming meeting, because of
some "unfinished homework" on the part of Indonesia.

The FATF has demanded many changes to the money laundering law
because it does not meet international standards in some areas.

For instance, according to Yunus, the FATF questioned why the
law only categorizes suspicious transactions as money laundering
when they were worth more than Rp 500 million (some US$65,000).

"It means that we cannot conduct any kind of investigation on
transactions worth Rp 499 million or below, even if they are
fortunes alleged to have been generated from crime," Yunus said.

The existing law stipulates that banks or other financial
institutions must report to the authorities if they uncover any
suspicious transactions involving at least Rp 500 million.

"Revision on such a clause in the law would play an important
role in lifting the country off the blacklist."

"(In the upcoming meeting), they will determine if we've made
significant progresses, especially in those areas. But if they
decide otherwise, we may face more problems related to the
blacklist," he added.

The problems he referred to could include staunch warnings to
multinational corporations about doing business in Indonesia;
force banks to collect detailed information before conducting
transactions with individuals or companies in those countries;
and make it more difficult for banks to make transactions with
businesses operating here.