Abdul Khalik, Nusa Dua, Bali – Indonesia is seen to be a main target for money laundering, as a report by the Indonesian financial intelligence unit reveals, with a sharp increase in suspicious transactions at financial institutions prior to the upcoming elections.
The cases allegedly involved money that had been transferred to politicians to finance political campaigns for the 2009 legislative and presidential elections.
The report from the Financial Transaction Reports Analysis Center (PPATK) shows that suspicious transactions, at domestic banks and non-bank financial institutions, almost tripled from some 2,055 cases three years ago, to some 5,831 in 2007.
At December last year, the total number of suspicious transactions reported to the anti-money laundering center had reached 12,000 since the center opened in 2001.
"The center has seen a significant increase year by year. Currently, we have 16 suspicious transactions a day," PPATK chief Yunus Hussein told The Jakarta Post here Friday.
Yunus was in Bali attending a five-day international conference of the States Parties to the United Nations Convention Against Corruption, which concludes Friday.
He said the suspicious transactions were an indication of money laundering cases in Indonesia, a country regarded as a target for international money laundering activities.
"We are now analyzing those transactions and if we are sure that there is a connection to money laundering, we will refer them to the police or prosecutors," Yunus said.
A transaction is considered to be suspicious if it involves, among others, a sudden transfer of money without clear explanations about the sender or their use of funds.
The PPATK said that the number of cash transactions filed by financial institutions tripled, from 1.5 million in 2005 to some 4.4 million last year.
The soaring number of cash transactions has raised suspicions that the funds may have been mobilized for the upcoming general elections.
Yunus said he did not rule out the possibility that the dubious transactions were connected to political parties and related institutions. "I think every political party has started raising funds early for their election campaigns, rather than waiting for next year," he said.
Money politics has been commonplace among political parties in Indonesia particularly ahead of and during national and local elections.
While poll monitors had reported money politics practices and other violations of the election regulations pertaining to the maximum limit of corporate and individual contributions to political parties, no cases have ever been brought to the courts.
This was attributed to weak financial investigations and data on such cases.
Yunus said his office would only be able to analyze and trace whether the financial transactions were channeled to political parties or politicians if the National Elections Commission (KPU) asks for help. "We are waiting for the KPU to sign a memorandum of understanding with us, to enable us to act," he said.
Yunus said he had asked the House of Representatives to complete the deliberations of a revised bill on PPATK, which empowers its role and authority to deal with suspicious transactions. If approved, the bill would allow the center to investigate suspicious transactions and freeze assets.