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Suharto family sees its fortunes ebb

Jakarta Globe - May 19, 2012

Markus Junianto Sihaloho & Bayu Marhaenjati – When President Suharto was in power from 1966 to 1998, no one dared speak ill of him or his family without fear of reprisal or imprisonment.

So when Suharto's youngest son, Hutomo "Tommy" Mandala Putra, was convicted of graft in 2000, it marked yet another a point in the decline of the once-powerful Cendana clan, named after the leafy stretch of road in Menteng, Central Jakarta, where Suharto lived.

After Suharto passed away in 2008, the family's influence in Indonesian politics diminished further. His eldest daughter Siti Hardiyanti Rukmana, known as Tutut, failed to make anything out of her fledgling political party, while Tommy was soundly defeated in his bid to become the chairman of the Golkar Party, which for decades was Suharto's political vehicle.

Tommy went on to found the National Republican Party, but it failed to qualify for the 2014 legislative elections. Now he is reportedly considering a move to the People's Conscience Party (Hanura), founded by Wiranto, Suharto's last military chief.

"There are attempts by Tommy to enter Hanura, but nothing is certain yet," a source in the party told the Jakarta Globe.

Saleh Husin, a Hanura legislator, would not confirm the reported move. "If Tommy wants to join Hanura, then it's good. We welcome anyone," he said.

As political figureheads, the remaining members of the clans are effectively outcasts, says Arya Fernandez, an analyst at Charta Politika. Behind the scenes, though, they still retain huge clout. He says none of the children has the character or political authority of the clan patriarch himself necessary to front a political party.

"The only way the Cendana clan can survive in the Indonesian political scene is to revive the old networks from Suharto's time and build new ones," Arya says. "In other words, they have to remain behind the scenes."

In its business holdings, the family has also experienced a decline, though not as severe as in the political arena.

In its heyday, the family and its cronies owned hundreds of companies, including television stations, banks, hotels, real estate firms and mining and logging companies.

In May 1999, Time magazine estimated the Suharto family fortune at $15 billion, including $9 billion reportedly stashed in an Austrian bank. During its time in power, an estimated $73 billion passed through its hands, the report said.

But soon after Suharto died, Tutut became embroiled in a business dispute over Televisi Pendidikan Indonesia, a TV station she founded in the 1990s with media mogul Hary Tanoesoedibjo. Hary eventually wrested control of the station and renamed it MNC TV, prompting Tutut to launch a legal case over what she saw as an illegal takeover.

The Tanoesoedibjos also took over a majority stake in Bimantara Group, a holding company co-founded by Bambang Trihatmodjo, Suharto's third child. Bambang saw his stake in Bimantara slashed from 40 percent to 10 percent since 2008, before he eventually left the company last month.

Ari Sigit, the son of Suharto's second child, Sigit Hardjojujanto, has become the latest of the Cendana family to be entangled in a business dispute.

Ari was named a suspect earlier this month after a firm he was linked to was accused of taking a Rp 2.5 billion ($270,000) advance payment for a dredging project without actually doing the work.

But Arya says the family continues to hold its own when it comes to its businesses. The clan's main strength has always been in business, he points out, even during Suharto's rule.

That, he says, is why most of the family's business cronies continue to profit from their dealings despite being ostracized from politics. "They have maintained their businesses quite well," he says.

[Additional reporting by Cinvy Anggriani, Vico Andriano & Elmen.]