JAKARTA - Indonesian Audit Watch (IAW) reminded law enforcement officials to be able to prove the elements of engineering and abuse of authority in the investigation of alleged corruption and money laundering (TPPU) related to the settlement of PT CBS's debt to PT Krakatau Niaga Indonesia (KNI). Because, business losses cannot be simply qualified as a corruption crime.
This was conveyed by the Founding Secretary of IAW, Iskandar Sitorus, in response to allegations of corruption in the state-owned enterprise environment, whose cases were handled by the Attorney General's Office (Kejagung) after being transferred by the National Police's Corruption Eradication Task Force (Kortastipidkor).
"Debt is a common thing in the business world. There are delays in payment, restructuring, submission of guarantees to business peace. Therefore, investigators should not immediately consider every debt settlement that is detrimental to the company as a criminal act of corruption," Iskandar told reporters in his statement, Thursday, July 16.
Iskandar assessed that the focus of the investigation must also be able to prove the abuse of office, conflict of interest, bribery, gratification, document manipulation, or the transfer of profits to certain parties in the debt settlement process.
"The public already knows that there is an alleged corruption in the settlement of debts. But the public does not know how the business relationship between the two companies, what the value of the debt is, what the object of the transaction that gave birth to the debt, how the settlement scheme is, and what decisions are allegedly influenced illegally. In other words, the public has only been given the title of the case, but the contents of the contract have never been opened in a clear way," he said.
Moreover, said Iskandar, every business loss cannot be assessed as a state loss even though PT KNI is part of the Krakatau Steel business group which operates in the steel trade.
"SOEs remain corporations that face business risks. There are customers who fail to pay, market prices change, and business decisions that may not go according to plan. All of these are not necessarily criminal acts," he said.
Therefore, said Iskandar, investigators must be able to clearly distinguish between business risks that are still protected by law and actions that have fulfilled the elements of corruption.
"New criminal laws can be used if there is evidence of abuse of authority, conflict of interest, bribery, gratification, falsification of documents, or engineering transactions that benefit certain parties illegally. Business losses alone are not enough to conclude that corruption has occurred," he explained.
Iskandar also highlighted the search conducted by investigators at the offices of PT CBS and PT KNI. According to him, this step is an effort to find comparative documents to test the appropriateness of recorded transactions with the actual conditions.
"From the documents, it will be seen whether the value of the debt is the same, whether the goods have actually been received, whether the payment is in accordance with the record, whether the guarantee has ever been transferred, to whether there are other agreements that are not included in the official document. At that point, business documents stop being ordinary administrative archives and turn into criminal evidence if there is found to be intentional engineering or deviation," he explained.
Furthermore, he reminded investigators to be able to penetrate the principle of business judgment rule, which is legal protection for directors who make business decisions in good faith, based on adequate information, without conflicts of interest, and solely for the benefit of the company.
"The principle is indeed to protect business decisions that turn out to be unsuccessful. But this protection is canceled if the decision is initially formed through bribes, gratuities, data manipulation, conflicts of interest, or abuse of authority. That's where the line between business failure and corruption must be clearly proven by investigators," he concluded.
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