Ismira Lutfia & Faisal Maliki Baskoro, Jakarta – The Jakarta chapter of the Alliance of Independent Journalists is urging an investigation into allegations that journalists demanded shares from Krakatau Steel in exchange for positive coverage of the state steel maker's initial public offering this month.

It is also in the process of reviewing the reporting on the IPO by the journalists in question to determine if it was fair or appeared to have been influenced in any way. The journalists were said to have demanded 750,000 shares of Krakatau, worth Rp 637.5 million [$71,500].

"They tried to put pressure on the company by threatening negative coverage of Krakatau Steel's IPO," Wahyu Dyatmika, chairman of the Jakarta chapter of the alliance, known as AJI, said on Thursday. He added that he had received information that the journalists also asked for cash.

AJI received reports from several parties connected to the offering that a number of journalists from "well-known media organizations" were involved, Wahyu said. He added that if the reports were true, the behavior would constitute a violation of the code of ethics for journalists. That code prohibits journalists from misusing their position for personal gain.

"We have asked the whistle-blowers to write down the allegations in a formal report to the Press Council so it can conduct an investigation, and to the police, considering that [the attempted] extortion would be a criminal offense," Wahyu told the Jakarta Globe.

Wina Armada, a Press Council member, told Tempointeraktif on Wednesday that it had received informal reports about the case and that only after a formal report had been filed would the council summon the journalists suspected of involvement. "This is not the first such case. Journalists who have acted like this in the past have been dismissed," he said.

Press Council members could not be reached on Thursday, but a source said that Wina's comments pre-empted the council's deliberations but the charges seemed credible. "Actually, this kind of thing is common practice," the source said.

But Harry Supoyo, president director of Mandiri Sekuritas, one of the underwriters for Krakatau Steel's IPO, denied that journalists had demanded his company hand out shares to them.

Wahyu said if the allegations proved to be true, harsh sanctions must be handed out to the journalists involved. "I call on journalists at the stock exchange or business journalists to declare if they own shares in companies listed there to avoid any conflicts of interest," he added.

However, Budi Suyanto, who covered the stock exchange for five years, said there was "nothing wrong with journalists wanting to invest." He told the Globe that stock market regulations did not classify journalists as parties barred from owning shares in listed companies unless they were associated with the operation of the stock market, such as public relations consultants.