Procurement of the Ministry of Defense Satellite Losses the State of IDR 453.09 Billion

JAKARTA - The connectivity prosecution consisting of the public prosecutor (JPU) and military prosecutors stated that the procurement of a 123-degree East Longitude (BT) Orbit slot satellite at the Ministry of Defense for the 2012-2021 period resulted in state losses of IDR 453,094,059,540.68.

"Defendant I Rear Admiral TNI Retired Agus Purwoko as the Director General of Defense Forces at the Ministry of Defense of the Republic of Indonesia (Kemenhan) for the period August 2012-September 2016 together with defendants II Arifin Wiguna and defendants III Surya Cipta Witoelar and Thomas Anthony Van Der Heyden committed acts unlawfully causing losses to state finances amounting to IDR 453,094,059,540.68," said the Connectivity Prosecutor at the Jakarta Corruption Court (Tipikor), reported by ANTARA, Thursday, March 2.

Arifin Wiguna is the Main Commissioner of PT Dini Nusa Kusuma (DNK), Surya Cipta Witoelar is the Technology Consultant of PT Dini Nusa Kusuma (DNK) for the 2015 - 2016 period and the President Director of PT DNK for the 2016 - 2020 period.

Meanwhile, Thomas Anthony Van Der Hyeden is a United States citizen who became PT DNK's Senior Advisor for the 2015 - 2018 period.

Initially, the Garuda-1 Satellite experienced an abnormal condition (thruster anomalies) and the fuel (hydrazine) had also run out so that the satellite could not manoeuvre to keep the station (station keeping) in its orbital slot, so it was recommended to decommission the Garuda-1 Satellite Operation 1.

Arifin Wiguna, who knew that the Garuda-1 Satellite had been deorbited from the Orbit Slot 123 degrees East Longitude, then sent a letter on behalf of PT DNK to the Minister of Communication and Information (Menkominfo) at that time Rudiantara regarding the development of the orbital slot.

However, Rudiantara stated that the management of the 123-degree East Orbital Slot had been handed over to the Ministry of Defense.

Then Arifin Wiguna together with Surya Cipta Witoelar and Thomas Anthony met with Rear Admiral Agus Purwoto as Director General of Defense Forces of the Indonesian Ministry of Defense (Kuathan) and explained PT DNK's steps to save the 123-degree BT Orbital Slot and the support of satellite expert consultants and investors, with a 40 per cent share for the interests of the Ministry of Defense and the remaining 60 per cent for commercial purposes.

Agus Purwoto stated that he was unable and did not plan to procure a satellite at the 123 degrees East Orbit Slot because the Ministry of Defense did not have a budget and did not have a team that understood satellites, but Arifin Wiguna still convinced Agus Purwoto to manage the 123 degrees East orbit slot to save state sovereignty.

"So that Defendant I Laksma Agus Purwoto is willing to manage the 123-degree East orbital slot together with PT DNK," added the Connectitas prosecutor.

The three also said that the Orbit slot for 123 degrees East will be lost if the Ministry of Defense does not fight for it as an operator that does not function if it does not have a spectrum, the distribution of which is regulated in the Operator Review Meeting (ORM).

Agus Purowo then decided to make Ali Reza Shoamenesh from the satellite operator company Telesat in Ottawa, Canada and Randy S Segal from the Law Office of Hogan Lovells in Virginia, United States of America as ORM participants.

"According to the results of the 17-1 ORM meeting which did not require the leasing of the Floater Satellite, Arifin Wiguna, Surya Cipta Witoelar and Thomas Anthony Van Der Heyden explained that 'DNK is ready to launch the new MSS L-Band satellite at Orbital 123 degrees East and if a temporary satellite is needed while waiting for the launch of a permanent satellite' by asking Agus Purwoto to lease the Artemis satellite," said the Konksitas prosecutor.

After listening to this explanation, Agus Purwoto agreed to lease the Artemis satellite owned by Avanti Communications Limited from London, England.

The company Avanti Communications Limited agreed to sign the contract if the Ministry of Defense represented by Agus Purwoto is willing to pay in advance the cost of moving the Artemis Satellite from Orbit Slot 23.5 degrees E to Orbit Slot 123 degrees East in the amount of 2.5 million US dollars.

"Defendant I Agus Purwoto realized that the signing of the Artemis satellite leasing contract would cause problems later on," said the prosecutor.

According to the connectivity prosecution, the Artemis Satellite leasing contract does not benefit Indonesian operators from joining the SSA "Working Group".

In addition, the age of the Artemis satellite belonging to the Company Avanti Communications Limited in 2014 was no longer suitable for use (retired) so the service coverage area of the Artemis Satellite was not by the filing of the Garuda-2 Satellite in Orbit Slot 123 degrees East and the specifications of the Artemis Satellite belonging to the Company Avanti Communications Limited, not by the specifications of the Garuda-1 Satellite.

By orbiting the Artemis Satellite at the orbital slot of 123 degrees East on November 12 2016, it cannot extend the period of suspension of Garuda-2 filing in the orbital slot of 123 degrees East for 300 MHz C-Band filing.

However, the Ministry of Defense continued to pay the Artemis satellite lease contract to Avanti Communication Limited for US$2,252,187.83 on April 22, 2016.

Avanti Communication Ltd again demanded payment to the Ministry of Defense of US$10,000,506.69 in August 2016 but because the Ministry of Defense did not have a budget, the Ministry of Defense used the Foreign Funding Fund (BIALUGRI) to pay it on August 31, 2016, or the equivalent of IDR 133,676,772,925.23.

The Ministry of Defense again issued a satellite lease on December 5 2016 for IDR 134,266,802,820 but the payment money was made as if it was paid to Avanti Communication Limited, when in fact it was deposited into the BIALUGRI fund account, and the remaining budget of IDR 20,255,408,347 was paid to the Law Office Hogan Lovells as Ministry of Defense Satellite Consultant.

All rental payments for the Artemis satellite lease contract include payments for the lease period for the Artemnis satellite contract for period II from 9 May 2017 - 9 May 2018, but in reality, the Artemis satellite has left the orbit slot 123 degrees East on 1 November 2017.

Since July 9 2018, the Ministry of Defense has no longer paid for the Artemis satellite lease through the Ministry of Defense's DIPA, so the Ministry of Defense was sued in the London International Arbitration and it was decided that it was obliged to pay Avanti Communications Limited for US$19,862,485 or IDR IDR 289,654,624,442 and paid to Avanti Communication Ltd for IDR 453,094,059,540.68.

The actions of the defendants resulted in a state financial loss of IDR 453,094,059,540.68 based on the Audit Report on the Calculation of State Financial Losses on the Case of Alleged Corruption Crimes for the 123-degree East Orbit Slot Satellite Procurement Project at the Ministry of Defense in 2012-2021 by the Financial and Development Supervisory Agency (BPKP) Number: PE.03.03/SR-607/D5/02/2022 on 12 August 2022.

The defendants were charged under Article 2 paragraph 1 or article 3 in conjunction with article 18 of Law No. 31 of 1999 as amended by Law no. 20 of 2001 concerning the Eradication of Corruption, Jo. Article 55 paragraph (1) to 1 of the Criminal Code.