GAB is pleased to welcome Simon Butt, Professor of Indonesian Law and Director of the Centre for Asian and Pacific Law, the University of Sydney, to contribute a two-part series on recent developments in Indonesia. Today’s post, the first of the two, is a revised and expanded version of an article that Professor Butt originally published on the East Asia Forum.)

Over the past decade or so, Indonesia’s anticorruption commission (the Komisi Pemberantasan Korupsi, or KPK) had managed to deflect numerous efforts of powerful politicians and senior law enforcement figures to reduce its independence and effectiveness. However, last month Indonesia’s national parliament appears to have successfully hobbled the Commission, with the support of President Joko Widodo. The effort to weaken the Commission began with the appointment of a new batch of commissioners, widely condemned as being sympathetic to the regime or likely to be ineffective. This was followed by amendments to the Commission’s founding statute that are clearly designed to render the Commission ineffective in investigating and prosecuting corruption.

An important precursor to these events was the KPK’s first loss in court. Until this past July, the KPK had not, since its establishment in 2003, lost any of the hundreds of cases it had brought to full trial. This was a remarkable achievement in a country renowned for deeply entrenched and widespread corruption at the highest levels, particularly in government institutions and the courts.

But on July 11, 2019, the KPK’s perfect record was broken when a divided three-judge Supreme Court panel voted to acquit Syafruddin Arsyad Temenggung, the former chair of the Indonesian Bank Restructuring Agency. Temenggung had been convicted at trial (in one of Indonesia’s specialized anticorruption courts) for a scheme in which a businessman, Sjamsul Nursalim, overstated the value of assets used to repay government assistance funds he had received after the 1997 Asian Economic Crisis. According to the prosecution, by improperly approving the discharge of Nursalim’s debt, Temenggung caused the Indonesian state to lose 4.5 trillion rupiah (well over USD 300 million). Temenggung’s lawyers argued, among other things, that there was no proof that their client had obtained any benefit from Nursalim in exchange for discharging the debt, and that their client was simply doing his job and had not committed any crime. The trial court rejected these defences, convicted Temenggung, and sentenced him to 12 years’ imprisonment. On the first appeal, the Jakarta High Provincial Court affirmed the conviction and increased the prison sentence to 15 years. But Temenggung then appealed to the Supreme Court, and there he prevailed. At time of writing, the Supreme Court judgment acquitting Temenggung has not yet been made publicly available. Nevertheless, according to media reports, two of the three judges on the panel voted to acquit Temenggung, though for somewhat different reasons, while the third judge would have affirmed the conviction.

Given that the KPK probably lacks a legal basis for asking the Supreme Court to reconsider its decision, the KPK appears to have now suffered its first defeat in its 15-year history. The loss of this case is a major blow on its own terms, because it was the KPK’s largest-ever case in monetary terms, involving over twice the alleged state loss than its previous largest case. But the significance of this acquittal may be much broader, and raises a number of questions about the future of corruption eradication efforts in Indonesia.

First, a bit more about the legal and political context: Under former President Soeharto, who ruled the country from 1966 until his downfall in 1998, corruption became rampant in Indonesia, including within law enforcement institutions, including the police, prosecutors and judges responsible for handling corruption cases. After Soeharto’s fall in 1998, genuine reformist fervor—and the view that, as some reformists put it, “You cannot clean the floor with a dirty broom”—led to the establishment of new, independent anticorruption institutions. These included both the KPK (designed as an independent body with its own investigators and prosecutors, and granted wide-ranging powers to both investigate and prosecute serious or complex corruption cases) and a special anticorruption court to hear the KPK’s prosecutions. The original specialized tribunal consisted of a court in Jakarta, with special judges brought from outside the existing judiciary, to decide the cases the KPK prosecuted. But because the KPK was not big enough to handle all corruption cases across Indonesia, ordinary police, prosecutors, and courts continued to handle corruption cases the KPK decided not to pursue.

For the first several years after its creation, the KPK targeted “small fry” government officials, avoiding the ministers and national parliamentarians suspected of larger-scale graft, and pursuing only cases that the KPK knew it could win. It was criticized for lack of ambition, but was able to establish a 100% conviction rate in the special corruption court. Once the KPK had consolidated its power and reputation, it began targeting higher profile figures. The KPK has now pursued over 250 national and subnational parliamentarians, over 130 governors and regents, and 27 Ministers and institutional heads.

An important legal change to the anticorruption courts system took place in 2009, after Indonesia’s Constitutional Court struck down the original anticorruption court system as incompatible with the principle of equality before the law. The Indonesian parliament responded by enacting a new law that established special corruption courts in each of Indonesia’s 34 provinces, and authorized both ordinary prosecutors and the KPK to prosecute in those courts. Almost immediately, the new courts began acquitting defendants, but only in cases brought by ordinary prosecutors. The KPK continued to have a perfect conviction rate in more than 500 cases. It has secured a conviction in every trial in a special corruption court, and until the Temenggung case, the KPK had always convinced the Supreme Court to uphold these convictions on appeal.

The KPK and other commentators explained this success rate as being a product of the KPK’s rigorous investigative standards, skills training, and, particularly, its masterful use of wiretapped recordings as evidence. Some commentators and lawyers expressed disquiet about using conviction rates as a measure of success, and have wondered if the special courts have simply rubber-stamped the KPK’s prosecutions, thereby compromising the presumption of innocence. Yet these claims have largely fallen on deaf ears; reformists tend to emphasise the deleterious effects of widespread corruption and accept the need for extreme measures to overcome it. Indeed, they have pushed the KPK to pursue even more corruption cases with greater vigor.

So, beyond the significance of the case itself, what does this first-ever defeat in the Supreme Court portend for the KPK and the broader struggle against corruption in Indonesia?

• First, and perhaps most narrowly, the acquittal brings into sharp relief the significance of the retirement of former Supreme Court Judge Artidjo Alkostar earlier this year after reaching the mandatory retirement age of 70. For many years, Judge Alkostar handled the lion’s share of corruption cases appealed to the Supreme Court. He had no sympathy for those appealing their corruption sentences; he was notorious for increasing sentences, sometimes by two-fold, and never acquitting. If Temenggung’s appeal had come before Judge Alkostar, an acquittal would have been unlikely. The Temenggung case may be the first indication that the Supreme Court can no longer be trusted to uphold anticorruption convictions as a matter of course.
• Second, it’s worth noting that Temenggung’s culpability might not actually be as clear cut as the KPK and the lower courts have suggested. Indeed, his case raises one of the more problematic aspects of Indonesian anitcorruption law: a finding of corruption requires potential loss to the state by means of an illegal act, but does not require that the defendant intended to enrich him- or herself, or another person. Some commentators have argued that this definition punishes government officials for making mistakes that cause financial loss to the state, rather than for stealing from the state.
• Third, whatever the merits of the acquittal in this case, there’s a genuine concern that the acquittal may indicate that attempts to undermine the KPK by politicians and police have borne fruit, which in turn implies that the KPK’s reputation and power might be slipping. This could put the KPK’s very existence in jeopardy if it depletes the KPK’s reserves of public trust, which is really the main force protecting it from political interference.

That third point might sound like hyperbole, but it’s important to recognize that the KPK has been subject to unrelenting attacks ever since it started going after high-level corruption by senior politicians and their cronies. Politicians have long threatened to disband the KPK or to reduce its powers. Many of the KPK’s commissioners have been spuriously charged with criminal offences brought by police at the behest of people the KPK was investigating. Some KPK personnel have even been physically attacked: one investigator lost an eye in an acid attack, and a commissioner had Molotov cocktails thrown at his house.

Now, under ordinary circumstances, the KPK would probably not be too worried by a single acquittal, especially since it’s used to the much more significant challenges just described. However, the acquittal came a time when the KPK was particularly vulnerable to politicians who feared being investigated. It came when the government was replacing the current five commissioners whose terms expire at the end of 2019, and gave the government a ready-made justification to install sympathetic commissioners, citing the need to overhaul the KPK in light of the failure this acquittal was taken to represent. It became clear that moves were on foot to weaken the Commission when a shortlist of 20 candidates contained four police officers and four current of former prosecutors, while some exemplary candidates with excellent track records did not make the cut.

In the end, the five commissioners appointed drew significant criticism, particularly from civil society and academics. The most problematic of them all is the KPK’s new leader, Inspector General Firli Bahur, a police officer who has previously worked for the KPK, but who was dismissed for misconduct. This is a serious threat to the Commission and the future of corruption reform in Indonesia, given that the KPK’s performance has long been associated with the integrity and determination of its commissioners.

In my next post, I will discuss the amendments to the KPK Law, passed in in mid-September, which are likely to cripple the Commission.