Devi Asmarani, Jakarta – Debt collectors, not a terror group, were behind Monday's deadly grenade explosion near a building owned by the United States embassy, police said.

The finding seems to quell an earlier suspicion that the blast, which wrecked one car in central Jakarta, was a terrorist act targeting US interests. Jakarta police said witnesses and suspects testified that the attack was masterminded by debt collectors.

A man identified as Abdul Azis – who carried the grenade – was killed in the blast while the driver, Yusuf Taul, was caught by police. Two other suspects who were in the car, fled the scene and are still at large.

A Jakarta police source told The Straits Times that the target of the blast was businessman Hasyim Setiono, who lives a few houses down from the vacant US-owned building which was once a guest house. The source said Mr Hasyim could not pay back debts worth billions of rupiah owed to another businessman, named Mr Juanda.

Jakarta police yesterday named Sandy Leonard as a suspect for ordering the bombing. He allegedly hired Azis and the three others to detonate the grenade outside the house. Leonard's associate and alleged accomplice, Made, has been questioned by the police as a witness.

Jakarta police spokesman Anton Bahrul Alam said: "This case is just another crime linked to debt-collecting activities but we can't say much more about the ongoing investigation." The police source said Leonard was ordered to collect the debt by Mr Juanda. Neither Mr Hasyim nor his family could be contacted.

Azis' wife Fahria Nahumaruri told police her husband had worked as a debt collector for Leonard since arriving from strife-torn Maluku province. But Madam Fahria went missing after questioning by the police. Jakarta media reported that she had not been back to her house in Bogor, West Java, since Tuesday.

Police said Azis had been arrested before for illegal possession of weapons after he and several others occupied Mr Hasyim's office last year to collect debts. He was released soon after.

The police source told The Straits Times: "We have handled cases involving debt collectors before and this is how they usually operate."