Indonesia's anti-graft chief was arrested yesterday for allegedly masterminding the murder of a company executive in a case that has rattled the country's efforts to fight corruption.

Corruption Eradication Commission (KPK) head Antasari Azhar was declared a suspect after hours of questioning over the murder of Nasrudin Zulkarnaen, the head of a state-owned company and a former KPK witness, Jakarta police chief Wahyono said.

Zulkarnaen was shot dead in March outside a golf course on the outskirts of Jakarta. Media speculation has connected the killing to an alleged love triangle involving the two men and a 22-year-old female golf caddy.

Allegations that Azhar was the mastermind of the killing have thrown into turmoil the work of the KPK, which has claimed high-profile scalps and is considered one of Indonesia's few clean institutions.

"Antasari was arrested and detained this evening," said Jakarta general crimes chief Muhammad Iriawan. "The case falls under Article 340 (on premeditated murder), which carries a maximum sentence of death."

Azhar, who has overseen a series of high-profile investigations into government officials and institutions, has not been officially charged.

Police said nine suspects had been named in connection with the murder of Zulkarnaen, the head of state firm Putra Rajawali Banjaran, who was slain in his car in a co-ordinated assault by attackers on motorcycles.

The suspects reportedly include the murder's alleged financier, newspaper owner Sigid Haryo Wibisono, and a former senior policeman.

The case triggered a storm of speculation in Indonesia, with the Attorney General's Office (AGO) forced to deny it was seeking revenge against Azhar for the high-profile corruption convictions of senior AGO prosecutors.

The AGO raised eyebrows late last week by announcing Azhar was a suspect, despite police and lawyers insisting he was wanted only as a witness. Police said they decided to name Azhar, who is on "temporary leave" from the KPK, as a suspect only after he was questioned yesterday.

While some supporters of the KPK cried foul over the arrest, other anti-corruption campaigners said the move against Azhar marked a step against impunity for the law among Indonesia's powerful.

"All this time there has seemed to be special protection for high-ranking officials, and the AGO may have been afraid this case would have stopped with the police," said Teten Masduki, a spokesman for the global anti-corruption watchdog, Transparency International. "The police have the authority to name someone a suspect. The AG0 didn't follow this rule, but its actions were helpful in the context of Indonesia."

Petrus Balla Pattyona, the lawyer for four men accused of carrying out the killing, said they had tried twice to kill Zulkarnaen and were threatened with death if they failed.

"They said they had received orders to kill and were threatened on their second attempt. (They were told) they were facing an enemy of the country who would divulge national secrets," Pattyona said.

Established in 2003, the independent KPK has earned a reputation for hard-nosed fighting against corruption and has helped to boost the anti-graft credentials of President Susilo Bambang Yudhoyono.

Despite Indonesia's recent gains, Transparency International continues to rate the country among the world's most corrupt. (AFP, AP)