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Editorial: Nailing chief auditor

We greatly commend the Corruption Eradication Commission (KPK) for its courage in naming Hadi Poernomo, who had long been considered an “untouchable”, a suspect related to the abuse of power he allegedly committed in mid-2004 while he was the director general of taxation

The Jakarta Post
Wed, April 23, 2014

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Editorial: Nailing chief auditor

W

e greatly commend the Corruption Eradication Commission (KPK) for its courage in naming Hadi Poernomo, who had long been considered an '€œuntouchable'€, a suspect related to the abuse of power he allegedly committed in mid-2004 while he was the director general of taxation.

What made the case grab front-page headlines was the fact that he was the first former tax chief ever charged with corruption even though the taxation directorate general has always been perceived nationally as one of the most corrupt public institutions in the country, which is internationally perceived to be one of the most corrupt in the world.

Another factor contributing further to making his case greatly controversial is that the KPK decision on the case was made on Monday, Hadi'€™s birthday and the day of his retirement as the chief of the powerful Supreme Audit Agency (BPK), one of the state institutions that had assisted the KPK in cracking graft cases. Fortunately, Hadi'€™s case does not in any way damage the reputation and credibility of the BPK.

Politicians who have been attacking President Susilo Bambang Yudhoyono'€™s government bailout of Bank Century (now Bank Mutiara) in late 2008 as blatantly corrupt may criticize Hadi'€™s case as retribution against him for the BPK audit opinion that the bailout caused more than Rp 7 trillion (US$608 million) in state losses.

In fact, on the same day Hadi was named a corruption suspect, he revealed to journalists attending his birthday celebrations and farewell party at the BPK office that the additional capital injection of Rp 1.25 trillion into Bank Mutiara by the state Deposit Insurance Corporation (LPS) last December had breached the Banking Law.

Despite the timing, we urge the KPK to get to the bottom of the case because corruption seems to have been quite systemic within the tax office.

We strongly believe the KPK'€™s move against Hadi has nothing to do with what has been perceived by the public as '€œthe clash between Hadi and the Yudhoyono government'€ with regards to the alleged irregularities in the Bank Century bailout.

The preliminary finding by KPK investigators after almost five months of investigations showed strong evidence that then taxation director general Hadi did abuse his authority by deciding, against the opinion of the then income tax director, to unlawfully grant income tax leniency for Bank BCA, causing Rp 375 billion in state losses.

To remove the suspicions of political conspiracy against Hadi, who was also known to be very close to Megawati Soekarnoputri, the leader of the Indonesian Democratic Party of Struggle (PDI-P), provisionally the biggest winner in the legislative election, the KPK should move faster and work harder to catch all other senior officials and directors of Bank BCA involved in what could later feed into daily headline news in the mass media as '€œthe Bank BCA tax scandal'€.

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