M

uhammad Reza Chalid may be the epitome of a shadowy business leader, a man involved in the country'€™s billion dollar fuel and oil import business with profound influence on the political elite.

Having largely avoided the media limelight, Reza has thus far proven to be immune from prosecution. Now, however, Reza finds himself at the epicenter of a political scandal revolving around allegations that he and House of Representatives Speaker Setya Novanto attempted to broker shares and projects from gold and copper miner PT Freeport Indonesia in return for a contract extension from the government.

 The scale and scope of Reza'€™s political tentacles were hinted at on Wednesday evening during the House'€™s ethics council hearing on Setya'€™s alleged misconduct. A majority of the council members agreed to make public a recorded conversation between Setya, Reza and Freeport Indonesia president director Maroef Sjamsuddin.

Setya and Reza, an Indonesian of Arab descent, boasted to Maroef that their clout reached deep into the Presidential Palace and the Indonesian Democratic Party of Struggle (PDI-P).

They claimed to have bought off Darmawan Prasodjo, a rising star in the PDI-P who also serves as deputy for monitoring and evaluation at the Office of the Presidential Chief of Staff.

'€œDarmo [Darmawan'€™s nick name] is cherished by him [Jokowi]. Having a PhD degree from the US, Darmo'€™s presentations have always made Jokowi happy. He has the ear of the President,'€ said Reza.

Setya then replied: '€œHe [Darmo] was bought after he met Bapak [Reza], locked and changed.'€

Darmo repeatedly denied any involvement in the plot before the ethics council made the recording public.

Reza also claimed to have strong relations with former State Intelligence Agency (BIN) chairman Hendropriyono and National Police deputy chief Comr. Gen. Budi Gunawan. Both Budi and Henropriyono are confidants of PDI-P chairwoman Megawati Soekarnoputri.

Coordinating Political, Legal and Security Affairs Minister Luhut Pandjaitan was also mentioned by Reza and Setya as their liaison with Jokowi. Both Reza and Setya believed the retired general had the ear of the President.

Reza claimed that it was because of his lobbying efforts with Luhut that the opposing Red-and-White Coalition (KMP), the backers of failed presidential and vice presidential candidates Prabowo Subianto and Hatta Rajasa, had agreed to throw its support behind Jokowi.

In an interview with The Jakarta Post last month, Luhut said that he knew Reza and Setya but had no business relations with them.

'€œI am fortunate not to have had any business relations with them. If I did, then I would be in big trouble now.'€

Since the fall of Soeharto'€™s dictatorship in 1998, Reza has climbed up the ladder from being a mid-sized fuel trader to eventually become a kingpin in the fuel and oil import business after the Megawati administration provided him with an incubator to expand between 2002 and 2004.

Then energy and mineral resources minister Purnomo Yusgiantoro, whose term was extended into then president Susiolo Bambang Yudhoyono'€™s first period of administration, is thought to have played a major role in the rise of Reza.

The success of Reza'€™s business hinged on orders from Petral, Pertamina'€™s fuel and oil trading arm in Singapore, with orders valued at more than US$30 billion annually, according to Energy and Mineral Resources Minister Sudirman Said.

With unlimited cash from his raft of companies, Reza expanded his influence into all quarters of the political factions.

Reza claimed in the conversation that he had been willing to bankroll Jokowi'€™s presidential bid if the then Jakarta governor agreed to pair with Hatta, the former coordinating economic minister during Yudhoyono'€™s term. Jokowi and the PDI-P turned down the proposal.

Reza and Hatta are inseparable friends. Wherever Hatta goes, Reza follows, including when the former agreed to pair with Prabowo in the 2014 presidential election.

According to the conversation, Setya claimed that he and Reza had donated Rp 500 billion (US$36.5 million) to the Prabowo-Hatta campaign. Reza, however, regretted the move, saying that he should have equally split the donations to both camps to effectively hedge for a Jokowi victory. After backing the wrong horse in 2014, Reza claimed that he now found himself in a difficult position.

'€œIf only we had divided the fund equally, we could have been happy. Rp 250 billion for Jokowi-JK [Jusuf Kalla] and Rp 250 billion for Prabowo-Hatta. We could have been sitting quietly, going to Singapore, playing golf. All is secured,'€ he said.

Reza has seen his business deteriorate after Jokowi declared war on the oil and fuel mafia by first shutting down Petral'€™s operations in May and then centralizing the purchase of fuel and oil at Pertamina'€™s headquarters in Jakarta.

Sudirman has also encouraged the purchase of oil and fuel directly through a government-to-government mechanism rather than through the spot market to limit the operations of brokers.

Sudirman has also declared a crusade against oil brokers attempting to undermine reform in the energy sector.

'€œI have no personal issues with him [Reza]. I'€™ve never tried to disturb his business,'€ said Sudirman in an interview with the Post in October.

'€œBut I cannot tolerate it if there is an intention [from him] to occupy and dictate the Presidential Palace and government agencies just to preserve his own interests,'€ Sudirman said.
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