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Indonesia: Bill on Money Laundering Considered in House

(Dec. 27, 2013) Indonesia’s House of Representatives (Dewan Perwakilan Rakyat Republik Indonesia) is considering a new law on money laundering. (Draft Law … on the Prevention and Suppression of the Crime of Money Laundering [in Indonesian], House of Representatives website (last visited Dec. 24, 2013).) The draft legislation is now listed as “under discussion by a special committee.” (RUU yang Sedang Dibahas oleh Panitia Khusus [Bills Under Discussion by Special Committee], House of Representatives website (last visited Dec. 19, 2013) [scroll down to find list of bill titles]).) The money laundering legislation now in effect is contained in the 2010 law on the subject, a revision of a 2002 law. (Law No. 8, 2010, on the Prevention and Eradication of Money Laundering [in Indonesian], House of Representatives website; English translation, FLEVIN.COM (last visited Dec. 20, 2013).)

The proposed legislation would limit cash transactions and put in place other measures aimed at preventing corruption. The goal had been to have it in place before the planned elections for 2014; polls are scheduled for both legislative and presidential elections. According to a news report of December 16, 2013, however, the matter has stalled in the House. (Novianti Setuningsih, House Stalls New Law that Prevents Money Laundering, THE <?JAKARTA GLOBE (Dec. 16, 2013); Indonesia’s 2014 Elections: Let the Games Begin, THE ECONOMIST (Sept. 7, 2013).)

Argus Santoso of the Financial Transaction Reports and Analysis Center (Pusat Pelaporan dan Analisis Transaksi Keuangan, or PPATK) stated on December 14 that “[w]e hope it can be deliberated soon and that it can be included in the National Legislation Program [Prolegnas] because it doesn’t contain many articles.” (Setuningsih, supra.) He added that it is believed that cash flow before the elections will be high, so adopting this legislation is a key to having a clean electoral process. He also advocated the establishment of a database for financial transactions, “[s]o that we can trace the donations to certain people from financial service providers such as banks, non-banks, and capital markets. All this time we don’t have a database, we only have transaction reports. Hopefully [the new system] can be implemented by Feb. 14, 2014.” (Id.)

The PPATK, a government body set up in 2002, has the authority to implement Indonesia’s policy on the prevention and eradication of money laundering and to build an anti-money laundering regime in the country. (PPATK, INTERNATIONAL CENTRE FOR ASSET RECOVERY (last visited Dec. 19, 2013); PPATK website (last visited Dec. 19, 2013).) Under Law No. 8 of 2010, the PPATK reports are made available to other institutions, including the anti-corruption authorities. (United Nations Office on Drugs and Crime, Indonesia: New Anti-Money Laundering Law Passed (Law No. 8 of 2010), TRACK (last visited Dec. 19, 2013) [download from list of article titles].)