President Joko "Jokowi" Widodo has suspended Corruption Eradication Commission (KPK) chief Firli Bahuri, his aide said on Saturday, following an accusation of extortion in an investigation that has ensnared a former minister.

The step came after police this week named Firli as a suspect accused of extorting money from former agriculture minister Syahrul Yasin Limpo, who was detained in a corruption case last month.

"President Joko Widodo has signed a presidential decree on the suspension of KPK chief Firli Bahuri," said Ari Dwipayana, the co-ordinator of the president's special staff, using the abbreviation of the agency's name.

Jokowi's letter, signed on Friday, takes immediate effect, releasing Firli from all his tasks and authority until he is fully discharged once his status changes to defendant, he added, with Nawawi Pomolango, a deputy, named as interim successor.

Firli and the agency did not immediately respond to a request for comment.

A former inspector general of police, Firli becomes the latest official in Widodo's administration to face graft accusations.

Police said authorities had confiscated foreign currency transaction documents from Singapore and Rp 7.4 billion (US$476,417) worth of foreign currency in two raids relating to the case against him.

Firli was appointed in 2019 at around the time critics said the KPK had been weakened by changes to the law governing it, triggering a series of protests that aimed to save the body.

On Thursday, a former agency chief and a number of investigators shaved their heads in front of its office in the capital, Jakarta, saying the gesture celebrated the clean-up.