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Kickbacks allegedly helped Meikarta takeoff
Neneng Hasanah Yasin - Billy Sindoro (Antara)Findings of alleged bribery related to a property megaproject developed by diversified conglomerate Lippo Group in Bekasi, West Java, have indicated that corruption at the local administration enabled a flawed project to begin
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Neneng Hasanah Yasin - Billy Sindoro (Antara)
Findings of alleged bribery related to a property megaproject developed by diversified conglomerate Lippo Group in Bekasi, West Java, have indicated that corruption at the local administration enabled a flawed project to begin.
The company’s executive, Billy Sindoro, who is identified by the Corruption Eradication Commission (KPK) as the Lippo Group operational director, allegedly instructed his subordinates to give bribes with a “commitment fee” amounting to Rp 13 billion (US$856,869) to Bekasi Regent Neneng Hasanah Yasin in order to influence the issuance of permits necessary for the construction of Meikarta, a modern city project in Cikarang.
The project, which is to include apartments, hotels and business centers, was reported by the West Java administration last year for failing to secure the necessary permits for construction.
Despite this, the project’s construction and property unit sales have resumed.
Coordinating Maritime Affairs Minister Luhut Pandjaitan attended a topping-off ceremony for two of the project’s towers in October last year.
The KPK recently found that Both Billy and Neneng, as well as a number of Bekasi officials and Lippo consultants, allegedly colluded to help the project get started.
During an operation on Sunday and Monday, graft busters seized Rp 513 million and S$90,000 ($65,529), which was believed to be part of Rp 7 billion of illicit money that had been handed over to the regent and other officials of the regency administration.
“We are investigating suspicions of illicit money flow to accelerate or influence permit issuance, which is still under the regency administration’s authority,” KPK spokesman Febri Diansyah said on Tuesday.
Moreover, the antigraft body revealed the bribery was tied to various permits necessary for the first phase of the project, which covered a total area of 84.6 hectares.
KPK deputy chairman Laode Muhammad Syarif said during a press briefing on Monday night that the company needed to secure the necessary permits and documents, including Environmental Impact Analysis (Amdal) from a number of agencies due to the scale and complexity of the project.
According to the company, the megaproject will see the development of commercial areas on 150 ha of land and a housing area as large as 530 ha. Future development of Meikarta will require an estimated 2,200 ha.
After undergoing more than 20 hours of questioning, both Billy and Neneng were detained by the KPK. Investigators also questioned another suspect, Neneng Rahmi, the Bekasi Public Works and Housing Agency’s spatial planning division head, after she surrendered herself early Tuesday. She was suspected of fleeing the scene of an alleged illicit transaction on Sunday.
Issues regarding permits in the Meikarta project came to light last year, when then-West Java deputy governor Deddy Mizwar called on Lippo Group to stop construction and marketing for the project, as the regency administration had yet to issue any permits.
As time went by, the group eventually obtained a recommendation from the provincial administration to develop the project on 84.6 ha of land, as opposed to 500 ha as initially requested. The West Java administration also ordered the developer to obtain permits from Bekasi regency.
The arrest has raised concerns over similar ongoing megaprojects across the country. Dewi Kartika of the Agrarian Reform Consortium (KPA) said such projects were prone to corruption and land conflicts given the non-transparent nature of the work.
The group recorded that, last year, 199 cases, or 30 percent of total conflicts, were in the property sector, only second to the plantations sector, which recorded 208 cases.
Responding to the case, Meikarta project developer PT Mahkota Sentosa Utama (MSU), a Lippo Group subsidiary, stated it would conduct an internal investigation to probe the case.
“PT MSU will not tolerate any wrongdoings that violate our antigraft commitment, and we won’t hesitate to hand down a heavy punishment to any parties found guilty of violating our rules,” said Denny Indrayana, a lawyer representing the company and former law and human rights deputy minister.
Lippo Group information and communications director Danang Kemayan Jati did not respond to The Jakarta Post’s question on whether the company would continue the Meikarta project.
