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Jakarta Post

Influential Setya uses up one more of his nine lives

  • Rendi A. Witular and Haeril Halim

    The Jakarta Post

Jakarta   /   Wed, November 18, 2015   /  06:15 pm
Influential Setya uses up one more of his nine lives Besieged: House of Representatives Speaker Setya Novanto (center) leaves his office on Tuesday. Setya has denied allegations that he asked mining company Freeport Indonesia for 20 percent of its shares on behalf of President Joko “Jokowi” Widodo and Vice President Jusuf Kalla as a condition of having its lucrative mining contract extended in 2021.(JP/DON) (center) leaves his office on Tuesday. Setya has denied allegations that he asked mining company Freeport Indonesia for 20 percent of its shares on behalf of President Joko “Jokowi” Widodo and Vice President Jusuf Kalla as a condition of having its lucrative mining contract extended in 2021.(JP/DON)

Besieged: House of Representatives Speaker Setya Novanto (center) leaves his office on Tuesday. Setya has denied allegations that he asked mining company Freeport Indonesia for 20 percent of its shares on behalf of President Joko '€œJokowi'€ Widodo and Vice President Jusuf Kalla as a condition of having its lucrative mining contract extended in 2021.(JP/DON)

In his influential 16-year political career, senior Golkar Party politician and House of Representatives Speaker Setya Novanto, 60, has never given in to the myriad attempts by rivals to bring him to his knees.

Like a cat with it'€™s mythical nine lives, Setya has always seemed able to dodge the latest bullet.

But his current embroilment in an ethics case revolving around allegations that he abused his power during negotiations with the local unit of US mining giant Freeport McMoRan may pose one of the most severe tests yet to his survival.

Energy and Mineral Resources Minister Sudirman Said reported Setya on Monday to the House'€™s ethics council for allegedly citing the names of President Joko '€œJokowi'€ Widodo and Vice President Jusuf Kalla while attempting to secure shares and projects from Freeport in exchange for helping the company extend its contract and continue mining the world'€™s biggest gold deposit in Papua.

Sudirman has also alleged that Setya conspired with influential businessman Muhammad Reza Chalid to demand shares in a soon-to-be constructed power plant near Freeport'€™s site, from which the company would be required to buy electricity.

The minister'€™s allegation is based on a recorded conversation involving Setya, Reza and PT Freeport Indonesia president director Maroef Sjamsoeddin, a former National Intelligence Agency (BIN) deputy chief and close associate of the Vice President'€™s family.

Although Setya was quick to clarify on Monday the accusations with Kalla, also a senior Golkar politician, his hope of a savior arriving from that quarter anytime soon looks unlikely to be fulfilled, as Golkar has yet to voice any strong statement in defense of Setya.

'€œThe ethics council should not hesitate to process the report. But they should also be just and work based on facts. The Golkar faction supports the process as long as it is for the greater good of the House,'€ said outspoken Golkar legislator Bambang Soesatyo.

Bambang, who is in the same camp with Setya, as supporters of Golkar chairman Aburizal Bakrie, also urged Setya to apologize to Jokowi and Kalla.

This time around, Setya is unlikely to galvanize enough support from his party colleagues to escape the ethics council, particularly when Setya has been regarded as among the strongest candidates to succeed Aburizal.

Setya'€™s main rival for the chairmanship is Ade Komarudin, 50, Golkar faction leader in the House and the protégé of veteran Golkar luminary Akbar Tandjung, according to a source in Golkar.

'€œCertain groups within Golkar are actually happy with Setya being implicated in the case. His chance of leading Golkar will at least be diminished regardless of the outcome of the ethics council [investigation],'€ said the source.

Ade is known to have forged close ties with Jokowi, and the President has often invited him for discussions as well as accepted his invitations to the activities of the Organization of Independent Employees of Indonesia (SOKSI). SOKSI is chaired by Ade and is the biggest contributor of votes to Golkar.

Unlike Setya, Ade has openly praised the Jokowi administration and has pledged to extend his support in passing crucial issues in the House. According to a source in Golkar, Jokowi seems to be comfortable with the idea of Golkar being led by Ade.

Golkar, the second-biggest party after Jokowi'€™s Indonesian Democratic Party of Struggle (PDI-P), is still officially part of the opposition Red-and-White Coalition. The support of Golkar would boost Jokowi'€™s coalition, giving it control of more than 55 percent of House seats.

Unlike Ade, Setya has long forged an extensive network that spans various levels of government and the judicial system, dating back to the early 1990s when he was accepted by then president Soeharto and his children into their circle of friends.

Setya was the publisher of two books on Soeharto'€™s management style during this period.

Soeharto'€™s fall in mid 1998 did not hamper Setya'€™s business or political career, as he secured a legislative seat with Golkar for the first time in 1999.

Since then, Setya has been known to be a generous politician wielding huge financial contributions to keep the party'€™s engine running, particularly when Aburizal'€™s group of companies began to stall in the past five years.

This has earned Setya, who has more than a dozen companies ranging from property to mining, loyalty and support within Golkar, and other parties, that have enabled him to weather any storm.

Setya, along with deputy speaker Fadli Zon, recently emerged unscathed from charges of ethics violations after both appeared at a campaign event for US presidential candidate Donald Trump in New York in September.

The ethics council concluded that the two legislators had merely committed a minor misdemeanor.

For Setya, the Trump incident was trivial compared to previous cases implicating him in graft.

In April last year, Setya was named by witnesses in allegations of bribery and money laundering in a graft case relating to local election disputes that were heard at the Constitutional Court, and which led to former chief justice Akil Mochtar being imprisoned for life.

In December 2013, former Democratic Party chief treasurer Muhammad Nazaruddin, who is serving a seven-year prison sentence, implicated Setya in the 45 percent mark-up of an electronic identity card (e-KTP) project worth Rp 5.8 trillion (US$422.5 million).

The Corruption Eradication Commission (KPK) has never followed up these leads.

Since 1999, Setya has avoided being named a suspect in at least four graft cases in which witnesses revealed his alleged involvement.

But unlike the previous cases, the Freeport controversy will pose a more serious threat to Setya'€™s career, given that Jokowi and Kalla are reportedly furious at Setya'€™s misuse of their names.

Jokowi seems to have weighed up the impact of bringing down Setya as he has given the nod to Minister Sudirman to publicly expose the case.

'€œThe President is very irritated [...] The report that I filed with the ethics council was based on my consultation with the President and the Vice President,'€ said Sudirman.
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Cases in which Setya has been implicated

1999: Bank Bali scandal, which causes state losses of Rp 904 billion.

2013: Imprisoned former Democratic Party chief treasurer Muhammad Nazaruddin implicates Setya in the mark-up of an electronic identity card (e-KTP) project worth Rp 5.8 trillion

2013: Setya is accused of soliciting a US$1 million bribe from an official in Riau in return for Golkar lawmakers approving construction projects for the PON XVIII games.

2014: Setya is named by witnesses as being involved in alleged bribery and money laundering in a case that saw former Constitutional Court chief justice Akil Mochtar jailed for life.
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Several lines from the transcript of the tapped conversation

- Setya says: '€œI met with Energy and Minerals Minister [Sudirman Said] in Surabaya (East Java). He told me about three things. First, that revenue sharing should be increased. Second, about the privatization of shares from 30 to 51 percent. The third was the construction of a smelter.'€

- Setya claims that Jokowi approached him during a lunch and told him that Luhut wanted to talk.

- Maroef quickly countered him, saying that Setya'€™s arguments did not comply with the law and government regulations, adding: '€œ[...] If in Gresik it costs [$] 2.3 billion [to build a smelter], then how much will it cost in Papua? It is impossible to build it in Papua.'€

- Their conversation later moved to a power plant project in Papua. '€œA power plant? Who is going to have its shares. Is it from Pak Luhut?'€ Maroef questioned Reza, who responded by saying that the project was being eyed by Luhut.

- '€œThe share allocation is a demand of Pak Luhut'€™s, [he is] looking for [...] Freeport and other businessmen [to become investors in the project]. Pak Luhut actually had a talk with Jim Bob [Freeport chairman James Moffett] in the US. If we can do it [the project], then let it just stay as a secret between the four of us,'€ Reza explained.

- Maroef again disagreed with the plan because Setya and Reza demanded Freeport become an investor as well as buyer of the to-be-produced electricity.

- Maroef questioned whether Reza, Luhut and Setya were demanding a 49 percent share in the power plant, while the remaining 51 percent would be owned by Freeport.

- Setya told Maroef that Jokowi had originally agreed that the smelter be built in Gresik, but later changed his mind to Papua, but he guaranteed that Jokowi would agree with the plan Setya proposed.

- '€œI talked to Pak Luhut and he said he agreed to just take the 11 percent and give the remaining 9 percent (of Freeport'€™s shares) to Pak JK [Vice President Jusuf Kalla]. It should be a fair (allocation) because if it is not it will become a dispute,'€ Reza added.

- Setya said: '€œAccording to Pak Luhut'€™s talk with Jim in Santiago four years ago, [Luhut and others will receive] 30 percent [of the shares], 10 percent of which will be paid for by the dividends. This has become a debate that has influenced the situation. The President doesn'€™t like the scheme but Pak Luhut will go ahead with it.'€

- '€œ[The contract of] Freeport will be okay, and you [Maroef] will be happy, as will we. We will play golf [afterwards] and we will buy a new private jet, a good one,'€ Reza said.

- Maroef later said that he was upbeat that the contract deal would be made according to the existing regulation, but Setya said: '€œWe have to be clever. The key is Pak Luhut [now], and don'€™t worry about him, because [you] have me [in the scheme].'€
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