The government is now drafting a series of regulations for the implementation of the newly passed law on money laundering to ensure that the law can be enforced on schedule this year, an official said Wednesday.
Financial Transaction Reports and Analysis Center chairman (PPATK) Yunus Husein said that his agency was open to critique and suggestions when creating supporting regulations to enforce the law. He said he believed that the law might contain several loopholes.
“The new money laundering law is not perfect because the deliberation processes were colored by political compromise among involved parties,” he told a discussion at The Sultan hotel in Jakarta.
However, he said that the law included several promising changes, including allowing six law enforcer bodies — the National Police, the Attorney General’s Office, the Corruption Eradication Commission, the tax office, the customs office and the National Narcotics Body — to investigate money laundering indications.
Previously, the National Police was the only body in the country granted the right to investigate money laundering allegations. The police’s investigative monopoly was widely regarded as the main factor behind the low number of prosecutions. Indonesia Corruption Watch (ICW) reports that only 8 percent of suspicious transactions reported by the PPATK to the police were followed up by investigators. As of December 2009, only 26 cases had been legally processed under the 2003 Money Laundering Law.
According to PPATK’s latest data, there were 60,815 suspicious transactions at banks and other financial institutions in the first 10 months of 2010. The junior attorney general for internal monitoring, Marwan Effendy, said that the expansion of the number of investigating bodies was a significant breakthrough in efforts to eradicate money laundering practices in the country.
“Whistle blowers will have the choice to report indications of crime.
“If an investigating body doesn’t follow up their reports, they can report to other authorized bodies,” he said, adding that the multi-investigator system would strengthen the check and balance mechanism among investigators.
The multi-investigator system, he added, would also accelerate the investigation process and enable investigators to handle more money laundering allegations. Marwan also praised the law for providing a time-limit for transaction suspension, saying that such clarity would uphold the right of alleged money laundering perpetrators on their properties.
Article 65 and 66 of the law grants the PPATK the right to order financial service providers to temporarily suspend suspicious transactions for 15 days. The suspension provides time for the PPATK to analyze the legality of the funds and submit the result to investigators.
“Previously, transaction suspension was considered a human rights violation because there was no clear regulation and time-limit. The new law regulates the suspension clearly and provides time limits,” he told the discussion.
The House of Representatives passed the law on Oct. 5 this year then President Susilo Bambang Yudhoyono signed the new law on Oct. 22.