Cooperative Unit Law Must Be Revised Immediately So That KSP Indosurya Case Does Not Happen Again

The defendant Henry Surya, the owner of the Indosurya Savings and Loan Cooperative (KSP), on January 24, 2023, was acquitted of all demands by the prosecutor. (Special)

JAKARTA – The Panel of Judges at the West Jakarta District Court stated that the actions of defendant Henry Surya were not a criminal offense but a civil case. Thus, the judge in his decision on January 24, 2023, sentenced the owner of the Indosurya Savings and Loan Cooperative, or KSP Indosurya to be free from all lawsuits.

This means, said Farizal, a legal observer from Mataram University, that the judge saw the case from an administrative perspective. Defendant Henry Surya was proven to have made administrative management errors. Unable to properly manage the institution he leads so he fails to pay debts to his members.

"Maybe there is management that violates the rules of the Cooperative Law or the Minister of Cooperatives, causing losses to members. Thus, the judge in his decision used the sentence, "It is proven that he committed the act charged, but it is not a crime but a civil case (onslag van recht vervolging)'," he explained to VOI, Tuesday (31/1).

Meanwhile, the public prosecutor charged the defendant with criminal penalties of fraud and embezzlement, according to the minutes of investigation from the police.

Bareskrim Polri showed a photo of Indosurya KSP Operational Director, Suwito Ayub, who fled abroad using a fake passport. (Antara/Galih Pradipta)

“So indeed the response can be from two sides, from a civil or criminal side. In the KSP Indosurya case, legal advisers succeeded in convincing the judge that this was not a criminal case, only related to a cooperative procedural error. The reference is of course the Cooperative Law, not the Criminal Procedure Code," Farizal continued.

However, the Head of the Center for Legal Information (Kapuspenkum) of the Attorney General's Office Ketut Sumedana actually thinks that KSP Indosurya does not have legal standing as a cooperative, because it has never held a member meeting.

Based on other fact findings, the director does not have a membership card and has never been involved in making decisions such as the distribution of dividends or the remaining annual operating results. Thus, Sumedana still considers the KSP Indosurya case to enter the criminal realm.

Criminal Facts

There are a number of other trial facts that prove KSP Indosurya committed a criminal act. For example, regarding the collection of member funds of up to IDR 106 trillion. However, the results of the audit revealed that there were 6,000 members whose money was not paid and did not return, with a loss of IDR 16 trillion.

"This collection of funds was carried out illegally by exploiting weaknesses in cooperative law, used as an excuse to extract profits from the community," said Ketut in a written statement on January 30.

Then, on Henry's orders, some of the funds were channeled to his 26 shell companies and the rest was purchased for assets in the form of land, buildings, and cars under his own name and under the name of PT Sun International Capital.

"So, the savings and loan cooperatives are just an excuse to trick the public into collecting money at KSP Indosurya and ostensibly for the interests and welfare of the members," he said.

Coordination meeting between the Coordinating Minister for Political, Legal and Security Affairs Mahduf MD with the Minister of Cooperatives and SMEs Teten Masduki at the Office of the Coordinating Ministry for Political, Legal and Security Affairs Jakarta on 27 January 2023. (Antara/Public Relations of the Ministry of Cooperatives and SMEs)

In fact, continued Ketut, this act was carried out to avoid supervision by Bank Indonesia (BI) and the Financial Services Authority (OJK), as well as to avoid the licensing process for raising public funds through BI.

"There were no civil acts at all committed by Henry Surya with the other defendants June Indira and Suwito Ayub as administrators of KSP Indosurya. Instead, they take advantage of legal loopholes by using tricks, tricking victims, in this case, customers, under the guise of cooperatives, as if all activities are legal," he explained.

Thus, Ketut assessed, "The panel of judges' acquittal for the owner of KSP Indosurya was an inappropriate decision. In this regard, the Attorney General's Office is ready to appeal.”

Farizal was also of the opinion that if at the cassation level the public prosecutor could convince the judge that KSP Indosurya committed a violation of the cooperative's Statutes and Bylaws (AD-ART) or also carried out banking practices, the case could enter the realm of crime.

"However, as long as KSP Indosurya adheres to the AD-ART and complies with the Cooperative Law, in my opinion, the defendants will not be charged with criminal law. Unless it is proven that he is carrying out banking activities such as deposits or savings and loans at certain interest rates, and so on," he said.

Update the Cooperative Law

Such legal polemics have often occurred in cases related to cooperatives, especially cases of default on debts.

Because, said Farizal, the Cooperative Law in Indonesia is still very weak. It has never been renewed since 1992. Under this rule, all errors in cooperatives are administrative errors and the penalty is only a written warning up to the revocation of the license. Neither includes criminal penalties.

Not to mention the supervision regarding cooperatives and the unclear savings and loan implementation system. This is the weakness of cooperative law in Indonesia.

"Of course it is important homework for members of the DPR and the government to make changes to the Cooperative Law as soon as possible. So that later, no cooperative members will feel disadvantaged," added Farizal.

Coordinating Minister for Political, Legal and Security Affairs Mahfud MD agreed. As already reported by VOI, Mahfud will immediately coordinate with the DPR and the President. According to him, one of the points that will be revised is related to supervision because Law Number 25 of 1992 concerning Cooperatives does not regulate complex supervision like the Banking Law.

Currently, cooperatives supervise themselves so that the Ministry of Cooperatives and SMEs as well as the government and other supervisory institutions cannot be involved in the supervisory function.

"Please pay attention, we will submit a revision of the Cooperative Law so that fraud under the guise of cooperatives can be ended and prevented in the future," Mahfud said after a coordination meeting with the Coordinating Minister for Small and Medium Enterprises, the Attorney General's Office and the National Police Headquarters at the Coordinating Ministry for Political, Legal and Security Affairs, Jakarta on January 27th.