Russian chopper deal lands several in hot water
Kurniawan Hari, The Jakarta Post, Jakarta
Legislators have found numerous problems in the US$21.6 million purchase of four Russian-made Mi-17 helicopters committed by high-ranking officers in the Army, the defense ministry and the finance ministry.
The Army and the defense ministry were blamed for procedural mistakes, starting from the process of the public tender to the contract. The defense ministry and the finance ministry were held accountable for the payment problems.
Commission I for defense and security affairs of the House of Representatives urged the national police and the Attorney General's Office to charge Andy Kosasih, a middleman in the scheme, causing state losses.
"We have agreed to report Andy Kosasih to the police for theft and collusion," commission deputy chairman Effendi Choirie told the press after an internal meeting here on Wednesday.
Choirie added that Army chief of staff Gen. Ryamizard Ryacudu and the Minister of Defense must take harsh action against their staff members involved in the scandal.
The House's Commission started its investigation into the scandal on March 2 following media reports on alleged irregularities in the purchase of four Russian-made helicopters.
At least 13 figures, including the Army chief, secretary of the defense ministry Rear Marshal Suprihadi, the financial ministry's director of budgeting Achmad Rochjadi and Andy Kosasih from Singapore-based Swifth Air and Industrial Supply, were summoned for questioning.
The commission said that the decision of the Army chief on Oct. 10, 2002 to declare PT Putra Pobiagan Mandiri as the winner of the tender lacked objectivity and transparency.
"The authority to declare the winner of a public tender is in the hands of the defense minister," Choirie said, reading out a 25-page report.
The Army chief made the decision after receiving input from Col. Kusmayadi, a staff member in charge of the tender process. Later, on Oct. 31, 2002, the Army chief amended an earlier decree which was then misused by Andy Kosasih to create a performance bond.
The content of the performance bond contradicts the business contract and regulations on the purchase of equipment. Andy Kosasih and Swifth Air & Industrial Supply Pte Ltd., had manipulated the performance bond and did not present advance payment for the project, causing the purchase of helicopters to be halted, he said.
The commission urged the defense minister to cancel the business contract with Swifth Air and demanded the latter to return US$3.24 million for the advance payment. It also urged the government to improve the standard operating procedure in the purchases of military equipment through export credit facilities.
The defense ministry and the national police must report to the House's commission on the purchase of military and police equipment.