At present, although many countries have agreed to exchange information about financial transactions considered suspicious, there is still a loophole for corruptors to continue their evil intentions to move their assets, through money laundering, to safe places and away from the pursuit of law enforcement agencies in their home countries.

One of the ways that law enforcement or anticorruption agencies in Indonesia can hunt down illegal assets kept abroad is through regional or international cooperation carried out bilaterally or multilaterally with other countries in accordance with Article 44 of Law No. 15/2002 concerning money laundering, as amended by Law No. 25/2003. This international cooperation can be implemented in the form of the mutual legal assistance (MLA) to prevent and mitigate the occurrence of financial crimes.

Indonesia has several basic rules for implementing the MLA, including Law No. 1/2006 on mutual legal assistance in criminal matters and Law No. 15/2008 on the ratification of the Treaty on Mutual Legal Assistance in Criminal Matters, and, internationally, the MLA has been regulated in the United Nations Convention Against Corruption (UNCAC), which was ratified through Law No. 7/2006 on the ratification of the 2003 United Nations Convention Against Corruption.

As one of the state parties of the UNCAC, Indonesia can carry out mutual legal assistance under Article 46 point (1) of the UNCAC, which is mandatory for the UNCAC state parties including Indonesia: “States Parties shall afford one another the widest measure of mutual legal assistance in investigations, prosecutions and judicial proceedings in relation to the offences covered by this convention.”

The MLA implemented by Indonesia with the state parties of the MLA agreement is carried out with the aim of exchanging information in the framework of their respective law enforcements. The points mentioned in the agreement are usually related to investigations, prosecutions and judicial proceedings in accordance with their respective laws and regulations. In addition, assistance is usually carried out between the ministries of justice or between law enforcement agencies, in the form of: identifying or searching for individuals, obtaining certain documents, carrying out search and seizure requests, confiscating proceeds of crime, freezing assets and other assistance in accordance with the parties’ agreement.

However, the implementation of the MLA between Indonesia and other countries still faces problems such as differences in the legal system and the strictness of the security system in the banking industry (bank secrecy) where illegal financial assets (money obtained through crimes) are hidden.

This was explained by Kevin M. Stephenson, a former senior financial specialist in the finance and market section of the World Bank Group, in his book Barriers to Asset Recovery (2011): “Most of the legal barriers are onerous requirements to the provision of mutual legal assistance (MLA); excessive banking secrecy; lack of nonconviction-based asset confiscation procedures; and overly burdensome procedural and evidentiary laws, including the need to disclose information to asset holders during investigations.

Removing the legal barriers is obviously essential. Absent a clear and sound legal framework, asset recovery becomes, in a best-case scenario, arduous and, in a worst-case scenario, impossible.”

For the UNCAC state parties, matters related to the tightness of the bank security system can be minimized on the basis of Article 46 point (8) of the UNCAC, where the state parties of the UNCAC are prohibited from refusing to provide mutual legal assistance on the grounds of bank confidentiality. However, if the MLA is implemented with countries that are not state parties to the UNCAC or other international agreements, the difficulties of implementing the MLA cannot be avoided, unless these countries have other agreements on how to minimize the obstacles that will be faced in the MLA implementation.

Due to the problems in the implementation of the MLA, asset recovery cannot be maximally carried out. In addition, the problems are often caused by the lack of resolve or determination on the part of the parties concerned in implementing asset recovery. Particularly in Indonesia, the rules to prevent and mitigate money laundering have not been comprehensively stipulated in laws and regulations.

No wonder Indonesia is still ranked 62nd out of 126 countries in the 2019 Law Enforcement Index, which was released by the World Justice Project, which assesses corruption eradication within the government and implementation of an effective, clean and impartial criminal justice system.

For this reason specifically, the MLA must be carried out well, together with other countries, so that in the future the laundering of money derived from crimes such as corruption, bribery, smuggling, labor and human trafficking, banking crime, narcotics, terrorism, kidnapping and embezzlement can be prevented and eradicated by law enforcement and anticorruption agencies in Indonesia.

____________________

The author was a Vatican delegate at the second Session of the Conference of the United Nations Convention Against Corruption in Nusa Dua, Bali, 2008 and former member of the governing board of the Indonesian National
Law Commission.

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